Telling her in a way which she would experience as "being blindsided" as well as betrayed by her mother, would almost certainly light a fuse to her trust issues, her tendency to "act out" what has not been directly addressed, but a long held "family secret." If she was sexually abused, it is probable that other females, your sisters, other daughters, neices, and the children of close family friends were also abused. I agree with the responses above. And, it is very important to provide some safety around your daughter, and protect her relationship with her mother whom she "trusted" though unconsciously I think wanted her to tell you. She acting out her problems in self-defeating and self-sabotaging ways because she is angriest at her mother and you. However unreasonable this may be, you are the targets, and she is making sure that, perhaps for a lifetime if unaddressed, you will respond to her needs to be protected, now from her poor judgement, impulse control, and inability to address the issue directly. Please, find a social worker who has long and successful experience in specializing in child and adult sexual abuse cases. You and your wife make an appointment with her. The Social Worker will take you from there. Do not attempt to do approach this without professional assistance starting with you and your wife. I suggest the social work profession as I have found it to be the most comprehensive in seeing the issue as a whole, treating the problem in its fuller context, versus, treating in your daughter in isolation and reinforcing her tendencies to act out of the victim role. There are other professionals who would do a great job; I am speaking of a profession that as a matter of approach believes in addressing sexual abuse in the context of the whole family because it affects at least your whole family, if not some extended family and perhaps others. Perpetrators rarely take advantage of one child; this is a pathological problem and a lifelong one without treatment, even sometimes with treatment. It is unlikely there are not other girls, now women, who have family secrets they have been keeping of their own. Additionally, both you and your wife have fall out from the abuse of your daughter. You, specifically do not know what to do about your feelings toward your father and it is important you resolve this anger over an event brought to you after his death. Secrets and unresolved feelings have a way of incidiously expressing their existence in debilitating and destructive ways when not allowed to be addressed directly. Additionally, how do you feel about your wife first feeling she must choose loyalty to your daughter, later choosing to tell you? You are your daughter's parent, and it was not up to your wife to make this decision for you or for her daughter. She put herself between you and your daughter, suggesting she also has some feelings toward you, your father, and herself, as well as her ambivalence in keeping her word to your daughter. The children of mothers who have been sexually abused often have a history of having been sexually abused as well, though not always. What will be the "ripple" effects on those who he also abused if this is no longer a family secret? I do not want to overwhelm you; I do want to advise you of the very tangled web, a life changing and potentially destructive issue to you and your family without appropriate and effective guidance and treatment of your daughter, and the members of your family. If you have other children, including males, it is likely they have been abused or know of the abuse, creating internal conflict, guilt, anger, and other feelings which will serve as obstacles to them if not addressed. First thing, as I said, research and find a proven competent professional in this area of expertise, no generic therapist. Don't be afraid to ask their level of experience and comfort in treating your daughter, and your family. Once someone is found, you and your wife get the ball rolling by going in and explaining the situation. After this, your therapist will do the best job in helping you. Good luck, and I am sorry for the distress I know you and your family must feel. Feel free to ask for any follow up, or help in finding the most appropriate professional.
