When you get to the group of eight highwaymen conspirators, they'll spring their trap and attack you. Kill them all, then kill everyone else in the zone.
NOTE On Test if you died and zoned out the mobs would bug, and be unattackable. If this happens you'll have to delete the quest and start over. Just don't zone out.
Return to Daylia.
Track the "hired assassin" using your tracking and stealth skills North Qeynos.
He's on top of a chain over the bridge ( 416.36, -12.25, -24.52 ) . You must be stealthed to see him.