Morrowind:The Mad Lord of Milk

Quick Walkthrough
#Speak to Athyn Sarethi for duties.
#(Optional) Travel to the Grand Council Chambers in Ebonheart and speak to Llerar Mandas.
#(Optional) Travel to Tel Fyr and rescue Delyna Mandas.
#Travel to Milk and speak with or kill Arethan Mandas.
#Return to Athyn Sarethi to complete the quest.
#(Optional) Return to Llerar for a bonus reward.

Detailed Walkthrough

Duties
Athyn Sarethi in his manor in Ald'ruhn will ask you to deal with a former Redoran Noble, Arethan Mandas, who has gone mad. Arethan is in a cave known as Milk and is harassing travelers by demanding tribute. Milk is found a bit to the west of Ald'ruhn. Athyn Sarethi wants this matter solved, but he doesn't want his old friend killed if it can be avoided. He suggests talking to Arethan's father, Llerar Mandas, in Ebonheart.

Arethan's Madness
You can visit Arethan Mandas anytime. He is not hostile, but you have to get past his hostile guards. Arethan will talk to you, but all you will get is some mad talk. He mentions Delyna and Tel Fyr.

The simplest and quickest method is to just kill Arethan, though there is another solution. Sarethi mentions that Arethan's father, Llerar Mandas, can be found in the Grand Council Chambers in Ebonheart, and that you might want to talk to him before traveling to Milk. Llerar will tell you that his son went mad after Divayth Fyr kidnapped Arethan's daughter, Delyna, and believes that the return of Delyna just might cure Arethan's madness.

Rescuing Arethan's Daughter
Tel Fyr is located a small distance southwest of Sadrith Mora. There are no travel services, so swimming is required. Delyna Mandas can be found in the Onyx Hall of Tel Fyr, behind a locked (60) and trapped door. The door can be opened with Divayth's 1008th Key, or alternatively you can pick the lock or cast an Open spell. Nobody in Tel Fyr seems to care if you rescue her, Divayth himself cannot be concerned with such petty matters. Escort Delyna outside. Once there, she will give you an amulet which you can show to Arethan as proof that she is alive.

Curing Arethan
Travel to Milk and show Arethan the amulet and he will become slightly more sane and promise to stop demanding tribute. His guards will become friendly, if you haven't disposed of them on your way in. Report back to Sarethi in Ald'ruhn to complete the quest and receive a noticeable increase in disposition with all Redoran members. If you tell Llerar Mandas in Ebonheart the good news you receive an Ebony Closed Helm as well.

Notes
This quest is actually two quests combined into one for the sake of clarity. The two quest IDs are HR_MadMilk and HR_RansomMandas. The HR_RansomMandas denotes the optional path. Unfortunately, these quest IDs are often mixed up, see bugs.
If Arethan dies you will not receive the Reputation point, and the faction reputation and disposition rewards are reduced to 5. If you also mention the dead Arethan to Llerar Mandas, your disposition with him drops by 20. Mentioning him to Delyna Mandas drops your disposition with her by 75.
Arethan Mandas is hostile towards you if Delyna Mandas is dead. Llerar Mandas disposition drops by 20 if you bring up his dead granddaughter.

Bugs
 
Rescuing Delyna before being on the assigned quest, and curing Arethan and reporting back to Llerar Mandas will get you the Ebony Closed Helm and the reputation point. If you are a member of House Redoran and report back to Athyn Sarethi you will also get the faction reputation and disposition rewards. However, if you have the Unofficial Morrowind Patch installed, members of House Redoran should refrain from completing the quest this way, as Athyn Sarethi will eventually be unable to assign this quest due to conflicting Journal IDs. The UMP namely adds another Journal ID, LTM_HR_MadMilk, making it impossible for the correct Journal ID to be used. With the console the correct Journal ID can be added with  .
Llerar Mandas needs the topic Delyna Mandas before he can hand over his reward. He will activate the topic himself when on the HR_MadMilk quest if both Arethan and Delyna are still alive. If you started the quest by rescuing Delyna, you first need to restore Arethan's sanity before the topic Delyna Mandas can be accessed.
 
 
 
Use the console to type  , then talk to Llerar Mandas about her to complete the quest.
 

Quest Stages