As for the hilt, turn in all of the Shai'Din pieces and you are given the complete no-drop ceremonial sword back + Shai'Din Medicine Bag, and he asks for you to combine the blood of the 8 councilmen into the medicine bag to make a tanning agent, which you must return along with the blade for him to 'Judge You'
I'm too lazy to post the exact text, but the Councilmen are obviously the new mobs that appear near the Chardok Royals now, I've gotten 1 No-Drop blood on my main before it was known what it was for. I don't intend on finishing this, so let us all know what it yields, hope this helps all of you =)