Thanks for the report, CrazyWolf, but I was unable to reproduce this bug when I tested this quest.
Can you please help me narrow this down?
Return to Illas Tiltos to speak to Borinthas. There should be a cinematic with the guard speaking to you before you speak to Borinthas.
If this does not happen then please log out and reply here with your Log1.txt file attached.
The path to Log1.txt should be something like C:\Program Files (x86)\Reverie World Studios\Dawn of Fantasy\Log1.txt
You can attach it to a reply using the Manage Attachments button in Additional Options found below the Submit Reply/Preview Post buttons. If you are using Quick Reply, you'll need to click on the Go Advanced button first.
Thank you for your assistance.