When they reach Halifax , Nova Scotia , Jan introduces Sally to his invalid mother , Madame Orlock ( Lucie Mannheim ) . Jim uses his contacts to have Sally appear to be a true Nazi sympathizer by having Canadian government men expose her and warn the Orlocks to stay away from her due to her Nazi leanings . Sally pretends to try to break off their relationship to avoid trouble for them . Jan reveals that he is working for the Nazis and recruits Sally into his spy ring on the night of their greatest exploit . Sally has been waiting for this chance to find out who his fellow conspirators are , especially their leader . To Sally 's surprise , the leader turns out to be Madame Orlock , who is not Jan 's mother and is not an invalid . The others are people she met at her hotel ( who have been covertly observing her ) , and even include a port immigration officer . The leader reveals that one of the ships of an incoming convoy has been secretly replaced by another filled with explosives , which is to be detonated when they reach Halifax , wrecking the vital port ; a plan inspired by a devastating accident of the First World War . At this point , Jan reveals he is anxious to make up for a recent bungled secret mission to bomb British royalty which failed due to his contact man sending incorrect landmark signals to the bombers . This explains the opening sequence : Sally killed the Nazi agent and thwarted that mission . Sally finally learns that Jim is assigned to her , when she catches him breaking into Jan 's study to try to uncover evidence , just as she has . Later , after being caught unawares when Orlock sneaks into her room , she thinks fast to explain her friendliness to Jim . Orlock believes she is a double agent , but she claims she is tricking the enemy and avoids being summarily executed . She then slips Jim a note written in lipstick advising him to wait at headquarters for information and heads off with Orlock . Orlock orders Sally to telephone Jim and tell him that an attempt will be made to sabotage the '' Queen Mary '' , scheduled to sail later that night , and that all available agents should be immediately sent to stop it . Sally is able to warn Naval Intelligence of the actual plot ; RCMP officers are dispatched to the house . RCAF bombers are sent to bomb and destroy the ship . Jan shoots Sally before Jim can rescue her ; the bullet is stopped by a cigarette case which he gave to her earlier . Sally and Jim are married , and with Sally 's cover now blown , they return to London to meet her family
devastating accident
Halifax Explosion
Yellow Canary (film)