She has apparently been hiding in the closet of the house for an unknown amount of time...possibly since early morning when Dr. Cook left for work. Celeste begins stabbing the new wife and they fight and struggle. New wife tells the young daughter (not sure of her age...young enough that her mother was reading to her) to run as far and fast as she can and tell the neighbors she is being attacked. The knife fight then spills out into the front yard.
This is the point I guess that the phone tree started ringing around the neighborhood...my mom recalls our neighbor on the corner calling her telling her to get the kids in the house because Celeste Cook is killing her ex-husband's new wife out on the lawn.