Having just returned from Firehammer Hold, they met with Istval at the end of last session. He rewarded them for saving Jekk and they managed to have a pretty positive overall interaction with Istval. I note that because this party has a highly uneven track record wrt the NPC interactions. He also managed to get them an invitation to dinner with the Duke.
This group had some pretty nasty interactions with possession at the infernal summoning circle in Firehammer hold. Baazka knew a fair amount about the party from having spent a few hours in the head of one of the PCs, before getting ejected. The backstory on that is long and complicated, but resulted as the confluence of player choices and my desire to get the PCs on track to reach the end point of the module in the final session, despite having only done Julkoun and Firehammer Hold (yes, we really did spend 5 weeks at each of those locations).
The PCs showed up for dinner without suspecting the Duke of any ill intent. Sir Istval was not on time, so the Duke started without him. In reality, Istval had been deliberately delayed by Pencheska sending charmed villagers to vandalize the Temple of Amaunator while he was in it.
Each player then received a personalized note with either something they had observed, or a telepathic suggestion from Pencheska, designed to stir up trouble. Fortunately for the party, they pretty much all made their saves. However, this was enough pretext for the Paladin to use Divine Sense and then accuse the Duke of being a fiend. Cue his cries to his guards and combat ensued.
I'll note that the final fight is hard to balance. If no one fails their charm / dominate / suggestion saves, then Pencheska uses up her actions failing to swing the fight in her favor. If PCs fail saves vs Pencheska then I'm sure the difficulty level goes way up, but my player's dice rolled well against every one of her tricks. However, they also failed to use non-lethal (quite deliberately in some cases) methods against the Duke and he went down before his second action. Pencheska bailed out the window when it became clear that things were not going to go her way. Then stirred up some guards to "avenge" the Duke.
The party was left in the awkward aftermath of having killed the Duke and one of his guards. They did not distinguish themselves in the ensuing discussions, mostly by not being able to adequately explain why they went lethal against the Duke, trying to get away with looting the Duke's sword, or in one case, trying (very badly) to get the surviving guards to pledge fealty to one of the PCs as the new Duke. So, no knights of Daggerford reward for these guys. Based on the fiendish evidence on the scene, and the testimony of a surviving guard, Istval interceded on their behalf to get them remanded into his custody to work with him against the Red Wizards.