The Sword of the Crusader

Once you'll come back to the priory, you will be told the story of two young knights that have tracked down an undead knight turned evil in his lair. One of them died there, while his squire managed to get the greaves out of the cave. As guardian of the relics, he passes them to you and adds a marker on your map for you to easily find the lair. He wishes to go there with you once more, in order to defeat the wraith that killed his friend.

In the cave, the way to your foe is quite simple. Pretty quickly, you'll come to a big square hall guarded by a few leveled undead. Take the first on your left, and follow the map marker to the next section. Beware, there is a big ceiling trap just behind a double door, at the bottom of a staircase on the way.

Once you'll find the body of the dead knight, prepare for a good old fight. You should see a small wooden door right in front of you. The wraith waits for you on a lakeshore. It seems not to like fire damage too much, so a few fireballs should do the job. Try to kill it before it summons too many ghosts, and don't forget to take the sword that falls to the ground. Do not equip it yet, since it is cursed and needs to be taken to the chapel of Arkay in Cheydinhal.

Of course, go to Cheydinhal in order to finish this part of the quest. There will be several Auroreans waiting for you there. Kill them, then resacrate the sword on the central altar. You can freely equip it from that point.

Now that you have all the relics, you are ready for a good fight with Umaril. Go back to the priory.