Find Lysbith NcNaff at the arena at about 564.79, -411.50, -18.25
You say, 'hail Lysbith McNaff'
Lysbith McNaff says 'Hail! Ye've come to [serve Halas], have ye not? We're the Wolves o' the North and it is our task to defend our city from harm.
You say, 'I serve halas'
Lysbith McNaff says 'The Wolves o' the North show ye no ill will, but there's much ye must do t' earn our trust. Perhaps ye should speak with Lysbith and inquire o' the [gnoll bounty].
You say, 'what gnoll bounty?'
Lysbith McNaff says 'I've placed a bounty on the gnolls o' Blackburrow. Their whelps have invaded our land and we must carry the fight into their dens. Join the fight and return three gnoll fangs as proof of yer victory in Blackburrow. Do so, and earn the respect o' the Wolves o' the North.
At this point you give three gnolls teeth to Lysbith McNaff
Lysbith McNaff says 'Fine work, fine work! The gnoll threat must be extinguished before it can ever fully grow. Ye've done yer part to aid our cause. Please allow me to repay ye with a few provisions and a wee bit o' coin. Then, continue with yer good deeds.
Your faction standing with WolvesoftheNorth got better
Your faction standing with ShamenofJustice got better
Your faction standing with MerchantsofHalas got better
Your faction standing with SteelWarriors got better
You gain experience!!
You receive 4 gold from Lysbith McNaff
Actual reward received seems to be variable in the range 3-6GP, some rations and/or a torch.
As a note, it appears that Lysbith only says about inquiring of the Gnoll Bounty when your faction is low with her. Normally this dialogue is produced by some of the other members of the Halas community, designed for you to go the Lysbith and ask about the Gnoll Bounty directly. When your faction is higher, she will tell you about the Ice Goblin Necklace Quest and the Seux Quest.