Plot
Major General Clive Wynne-Candy (Roger Livesey) is the leader of the Home Guard during the Second World War. Before a training exercise, he is captured in a Turkish bath by soldiers led by Lieutenant "Spud" Wilson, who has struck pre-emptively. He ignores Candy's outraged protests that "War starts at midnight!" They scuffle and fall into a bathing pool.
An extended flashback ensues.
Boer War
In 1902, Lieutenant Candy is on leave from the Boer War. He has received a letter from Edith Hunter (Deborah Kerr), who is working in Berlin. She complains that a German named Kaunitz is spreading anti-British propaganda, and she wants the British embassy to do something about it. When Candy brings this to his superiors' attention, they refuse him permission to intervene, but he decides to act anyway.
In Berlin, Candy and Edith go to a café, where he confronts Kaunitz. Provoked, Candy inadvertently insults the Imperial German Army officer corps. The Germans insist he fight a duel with an officer chosen by lot: Theodore Kretschmar-Schuldorff (Anton Walbrook). Candy and Theo become friends while recuperating from their wounds in the same nursing home. Edith visits them both regularly and, although it is implied that she has feelings for Clive, she becomes engaged to Theo. Candy is delighted, but soon realises to his consternation that he loves her himself.
First World War
Candy, now a Brigadier General, believes that the Allies won the First World War because "right is might". While in France, he meets nurse Barbara Wynne (Kerr again). She bears a striking resemblance to Edith. Back in England, he courts and marries her despite their twenty-year age difference.
Candy tracks Theo down at a prisoner of war camp in England. Candy greets him as if nothing has changed, but Theo snubs him. Later, about to be repatriated to Germany, Theo apologises and accepts an invitation to Clive's house. He remains sceptical that his country will be treated fairly.
Barbara dies between the world wars, and Candy retires in 1935.
Second World War
In 1939, Theo relates to an immigration official how he was estranged from his children when they became Nazis. Before the war, he had refused to move to England when Edith wanted to; by the time he was ready, she had died. Candy vouches for Theo.
Candy reveals to Theo that he loved Edith and only realised it after it was too late. He admits that he never got over it. He shows Theo a portrait of Barbara. Theo then meets Candy's driver, Angela "Johnny" Cannon (Kerr once more), personally chosen by the Englishman; Theo is struck by her resemblance to Barbara and Edith.
Candy, restored to the active list, is to give a BBC radio talk regarding the retreat from Dunkirk. Candy plans to say that he would rather lose the war than win it using the methods employed by the Nazis: his talk is cancelled at the last minute. Theo urges his friend to accept the need to fight and win by whatever means are necessary, because the consequences of losing are so dire.
Candy is again retired, but, at Theo's and Angela's urging, he turns his energy to the Home Guard. Candy's energy and connections are instrumental in building up the Guard. His house is bombed in the Blitz and is replaced by an emergency water supply cistern. He moves to his club, where he relaxes in a Turkish bath before a training exercise he has arranged.
The film has now come full circle. The brash young lieutenant who captures Candy is in fact Angela's boyfriend, who used her to learn about Candy's plans and location. She tries to warn Candy, but is too late.
Afterward, Theo and Angela find Candy sitting across the street from where his house once stood. He recalls that after being given a severe dressing down by his superior for causing the diplomatic incident, he had declined the man's invitation to dinner, and had often regretted doing so. He tells Angela to invite her boyfriend to dine with him.
Years before, Clive had promised Barbara that he would "never change" until his house is flooded and "this is a lake". Seeing the cistern, he realises that "here is the lake and I still haven't changed". The film ends with Candy saluting the new guard as it passes by. The death of the old ideas is the death referred to in the title. The final shot is a close-up of the motto on the tapestry used as the background in the opening scene which states "Sic Transit Gloria Candy" (Thus passes the glory of Candy), parodying the well-known saying Sic transit gloria mundi — "Thus passes the glory of the world", i.e. fame is fleeting.
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