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Isabel and Ralph ride out to Gardencourt together. Once there, Isabel is left on her own. She goes down to look for Mrs. Touchett and finds someone in the parlor playing the piano very beautifully. At first she thinks it is a French woman when they begin to speak, then Mrs. Touchett comes in and she is revealed to be an American, born in Brooklyn, whose father was a Naval officer. Isabel admires Madame Merle a great deal for her grace and poise. She is around forty years old and seems to be full of "strong impulses kept in admirable order." Isabel, Mrs. Touchett and Madame Merle have tea together. Then Sir Matthew, the doctor from London, appears and Mrs. Touchett confers with him privately.
That evening, Isabel has a chance to talk about Madame Merle with Ralph. He has gotten good news about his father’s health and so is relieved of worries enough to chat with Isabel. He says she is "the cleverest woman I know excepting you." He says she is very much accepted by all society and can travel at will and be invited everywhere. He says his mother admires Madame Merle more than any other person. He adds that Madame Merle "does everything beautifully. She’s complete." Isabel realizes Ralph doesn’t actually like Madame Merle. He says he used to be in love with her. She finds out that Madame Merle has no children and that her husband died years ago.
The next day, Mr. Touchett takes a turn for the worse. Ralph goes in to see him. Mr. Touchett is sure he will die soon. He tells him he wants to know that Ralph will be doing something with his life. He wants him to have some new interest, particularly, he wants him to get married and he has Isabel in mind. Ralph says he is not in love with her, but that he would be if things were different. When Mr. Touchett is made to believe that Ralph will absolutely not propose marriage to Isabel, Ralph tells him he would like to do something for Isabel. He wants to see what Isabel can do if they "put a little wind in her sails." Mr. Touchett has left her a five thousand pound legacy, but Ralph wants him to divide his own inheritance equally and give half of it to Isabel. That comes to sixty thousand pounds, a fortune. Ralph says he wants to make Isabel rich so she can "meet the requirements of [her] imagination." Ralph argues that if Isabel has an easy income, she will never have to marry for economic reasons. Mr. Touchett has a great deal of difficulty understanding Ralph’s motives. Ralph explains that he wants Mr. Touchett to give the money to Isabel without noting that it was Ralph’s idea. Ralph explains that Isabel doesn’t know how little money she has and he doesn’t want to see her find out. Mr. Touchett argues that it is immoral to make it so easy for someone. Ralph answers that "to facilitate the execution of good impulses, what can be a nobler act?" Mr. Touchett’s final concern is about fortune-hunters. Ralph has thought of this and says he feels confident that Isabel is able to fend them off.
Two momentous events occur in this chapter. The first is only the set up to a larger plot development. It is the introduction of Madame Merle, a woman who will play a significant role in Isabel’s life. The second is the transformation of Isabel from a poor relation to an equal. In settling such a large fortune on Isabel, Mr. Touchett assures her of the material basis of an independent life. With this much money, Isabel could live the kind of life Mrs. Touchett lives without marriage to interfere in her freedom.
The reader realizes at this point the depth of Ralph’s strong feelings for Isabel. Remember he has only known her a few weeks. It is clear, however, that he loves her deeply and admires her freedom. On one level, Ralph, who is tied down by his lung disease from living a free life, will get to see someone who seems to be quite a free spirit living a free life. He can thereby live a free live vicariously. On another level, the reader might wonder if Ralph is ensuring that Isabel remains unmarried. At least she will not marry any one for financial reasons. Such a motive is far from anything that Henry James would propose not to mention his noble character Ralph Touchett. Ralph’s stated reasons are a desire to give Isabel real freedom to experience life as her imagination prompts her to. Such a noble impulse sets up the ideal of the novel. With this kind of basis, Isabel’s chances seem limitless.
It is useful to wonder why the introduction of Madame Merle in he same chapter as the plan for Isabel’s new wealth. Perhaps the dreaded fortune hunter is in the same house with those bestowing the fortune on Isabel.