Mrs. Smith is the owner of Allenham Court. She is an invalid who does not mix in the neighborhood, and her most frequent contact with the outside world is the yearly visit of her nephew and heir John Willoughby; however, she comes to doubt the morality of his lifestyle and during his latest visit becomes discontent with how little time he is spending with her while he courts Marianne Dashwood.
She is informed of Willoughby's relationship with Eliza Williams through another cousin, who hopes to become her heir instead. She is outraged because of what Willoughby describes as "the purity of her life, the formality of her notions, her ignorance of the world," but she offers to forgive Willoughby if he will marry Eliza and, thereby, legitimize their child. When he refuses, he is disowned.
To recover his fortune, he marries the heiress Sophia Grey rather than Marianne Dashwood, whom he loves. Mrs. Smith eventually forgives Willoughby and again makes him her heir, which makes him realize too late that he could have had Marianne and a fortune.