I voted that I'd drop him if it was a DM set-up.
If the fall was because of my actions, I'd have had my reasons (i.e. wanted to play a fallen paladin) because I'm not dumb enough to accidentally have a paladin fall from grace.
If it was a DM set-up, I'd stop playing the character unless the DM has a really good reason for it. Chances are that I'd stop playing in that campaign altogether.
I had a situation that is kinda like this, but more or less turned upside down:
I was playing a LG fighter. He was all for the "law and order are best for everyone" thing, intended to make a career as a valiant defender of his country. He managed to get into the "special forces" - agents and guards that work for the king. They were supposed to guard him in some country estate for a couple of days, when suddenly lots of assassins (who disappeared upon death, of course) attacked, finally managed to kill the king (my guess is that that fight could have lasted a year or longer, going on until the king was dead), and then the survivors all disappeared. No chance to take any prisoners.
And then, we were, of course, blamed for the king's death. We were put on trial, and it was the most transparent framing since the invention of the glassless frame. Utterly ridiculous. We were sentenced to exile in some deathtrap dungeon.
After that happened, I told the DM that my character has lost all faith in the law and order he has previously worshipped, since he saw that it was all to easy to abuse the system. The whole thing (the trial, the jeering masses, the thrown vegetables and punches) also made him bitter and banned all goodness from his heart.
In short, I changed his alignment from LG to CN. I also played him accordingly.
The DM, of course, wasn't happy with that and called in unreasonable. He wouldn't see that the whole farce he put us through was even more unreasonable and that this was the only way I saw my character react to this incident.