This quest is mostly identical for both the Knights and The Righteous. For the Knights, start the quest by speaking to Brend; for The Righteous, speak to the Saint in the house for sale.
"I have to find a needle in a haystack. Someone in town has seen the Varo Family Signet Ring. Somehow I will need to find that person. Maybe Ozkar or Frillia can help me again."
Ozkar when asked suggests you seek information from Marvian. If you ask Frillia, she suggests you talk to Parius. Marvian can be found in The Thirsty Peasant, Parius in The Weary Traveller.
When you talk to Parius, it seems he may know something, but needs prompting.
"It seems Parius might know something. But how do I get it out of him? If I had more information, Parius might start to remember something useful."
Similarly, Marvian knows something too.
"It seems Marvian might know something. But how do I get it out of him? The problem isn't getting him to talk, he does plenty of that. The problem is getting him to make sense. I simply need more information before Marvian's drunken rambling will be useful."
Speak to Ozkar again, and he suggests that Rolena Strong-Arm or Nee-Hi may know something also. Both can usually be found in The Weary Traveller. If you speak to Nee-Hi or Rowena, they demand 100 Gold for the information. When you pay, they laugh and says all they knows is that the Ring is in a house.
"It's the first time the location has been referred to as a house. I wonder if that is enough extra information to prompt Parius' memory."
Now, when you speak to Parius again, he remembers something but will only tell you when you get him a drink. Not just any drink either, he wants some Cryodil Brandy: Private Stock. A bottle can be found on top of the Cupboard in Fracus' office on the top floor of the Legion Headquarters. There is another bottle on a Table in Corelius' rooms in the Town Officials in the castle. Another two can be found in Brend's room in Varo Manor. Take a bottle back to Parius, who takes it from you.
"The house is in the Slums. It isn't much, but at least it might be enough to answer Marvian's challenge. I wonder what drink he's going to demand."
Now return to speak to Marvian. He wants a bottle of Flin. There are two bottles on the third floor of Tubbia's Treatments and one in Ilmena's house on the table. Return with the Flin to Marvian, who takes it from you and tells you that it was Calacentia Romania who has seen the Ring.
"Finally, a name; Calacentia Romania. But what do I know about her? She supposedly saw the Varo Family Ring and she lives in the slums. That's about all I know, so far at least."
Find and speak to Calacentia; she has a house in the Slums but works in the Legion Headquarters, which is where she says she saw the ring.
"I have the information Brend/Stilus wanted I should let him know."
Now return to Brend or Stilus and update them. They want you to search Fracus' room for the ring yourself, or convince Calacentia to do it for you.
"Searching Fracus's room without risking a confrontation is going to be difficult, to say the least. Are my skills up to that kind of challenge? Or should I see if I can convince Calacentia to get the ring for me?"
In Fracus' room on the top floor of the Legion Headquarters is a locked Hidden Wall Safe. This is the picture on the north east wall. Inside it is the Varo Family Ring and Fracus's Journal. The Journal is one of the books needed for the quest The Historian. If you take the ring, your log updates.
"This looks like the ring I am looking for. I am sure Brend/Stilus is anxious to get a look at this ring."
Alternatively, Calacentia says she will get the ring for you, if you do her a favour. She wants you to retrieve a Smuggler's Key to a Chest. The Smuggler was killed and the guards don't know what the key is for.
"Calacentia has agreed to get the ring for me, with conditions of course. She wants me to acquire a key that is likely in the Castle near the jail cells somewhere. The key opens a chest filled with a smuggler's payment. She didn't ask me to get the payment, just the key. I don't know where the chest is, so the key won't do me any good. Or will it?"
The key itself can be found in the Jail part of the Servant's Quarters in the castle. The key is on a set of shelves in the room with a guard sitting behind the desk. You will need to steal it without the guard noticing, so stealth magics are useful, or you could use a telekinesis spell to bring the key to you.
Take the key back to Calacentia. She already has the ring, and gives it to you, taking the key.
You can always go and check the chest for yourself, whether you got Calacentia to get you the ring or whether you got it yourself. It's outside the castle, near a rock, roughly north east from the docks. The key will open this Partially Buried Chest, which contains 500 Gold.
"I have the ring and Calacentia has the key. I only promised to produce the key. Fortunately, ensuring her the payment was never part of our deal. I can hardly be blamed if the payment is missing after all this time. I'd better show the ring to Brend/Stilus to make sure it is the real one."
Now return to Brend or Stilus again with the ring, however you obtained it. Each wants you to go and talk to Fracus, but preferably not kill him. When you confront Fracus, if, when given the option, you choose a response other than "What would Alconius think?" Fracus will attack you. Given that he is in the Legion Headquarters, which can have quite a few Legion Soldiers as well as other officers, all of whom will also attack, provoking him into attacking is not an ideal option. By asking him what the Count would think of his actions, Fracus decides to leave Windfall.
"I have persuaded Fracus to leave. Brend/Stilus will be happy with this outcome. I don't think I will tell Brend/Stilus the entire story though. Fracus was loyal and faithful to Alconius for many years. I see no need to ruin the man's name when he can cause no further harm. I will leave Brend/Stilus with his illusions about Fracus."
Return to Brend or Stilus, both of whom will give you 500 Gold.
Your next mission will be to stage A Jailbreak.