Location: Tancheng City
Petitioner: Zhang Panlong
Reward: Martial Arts Notes, 3,000 coins
To trigger this side quest you first need to find your way to Tancheng City. It's located to the south of Pingkang City and the general starting area of the game. Head south until you see a waterfall, then cross the nearest bridge and keep going south a ways until you see a settlement on your right. This is Tancheng City.
The petitioner for this side quest, Zhang Panlong, is sitting at a table on your right as you climb the steps from the city's entrance. Speak to Panlong and he'll reminisce about a series of murders in Tancheng. He'll then ask you to do a favor for him: Deliver a Package from Zhang Panlong to the owner of Pingkang City's Pawnshop. He'll hold onto the package until you agree to the favor.
Hike north to Pingkang City, then run to the far west side of the city to find the Pawnshop. Speak to Qian the Shopkeeper, behind the front desk, and you'll learn that Zhang Panlong is... less sinister than he appears to be. Qian will give you some Qingfeng Liquor. Trek back to Tancheng City and speak to Panlong again to wrap up the quest and receive your reward.