Paladin and rogue in the same group - what's allowed and what's not?

[Kelb_Panthera]

So I've been playing a LE rogue in a party with a LG paladin. I've been trying to corrupt the paladin, mostly by acting pragmatically. Today was simultaneously awesome and horrible. We had just killed some Drow and were left with a single Drow priestess stuck in a (homebrewed) web that was doing 1 point of damage a round. I and the LN monk were trying to convince the priestess to join our side (I wanted to start up a spy ring, the monk wanted to convert her to his god). She had already decided to surrender and, in full view of the paladin, renounced her allegiance to Lolth. The paladin decided that because she was evil, she was probably lying and said that if we let her go, he would hire an assassin to kill her. The DM and I both told him that that wouldn't be the Lawful or Good thing to do, and he should instead be attempting to help her conversion to the side of good. I even told him about Eludecia (whose name I thought was Fall-From-Grace at the time), and his response was that any good cleric or paladin would immediately banish her. So in response, the GM dropped his alignment to LE. The paladin player decided to throw a temper tantrum and leave the game which ends the campaign for a myriad of reasons.

So to recap: Drow that had surrendered, and renounced Lolth, was stuck in a web that was slowly killing her.
Paladin wishes to kill the Drow, and is even willing to use evil ways to do so.
DM changes Paladin's alignment to Evil.
Paladin leaves game and campaign ends.

Sorry to hear it. You and your DM had the right of it though. I don't know that shifting him all the way to evil was appropriate, but a fall would definitely have been in order had he acted on those thoughts.