From Dragon Quest Wiki
Quest #56 - "Nicholas's Necklace"
Location Small island in Eastern Stornway.
Availability after doing Quest #039
Requested by Nicholas
Fulfilled to Nicholas
Item Required Memento necklace
Reward Seed of defence for first completion. Strength ring for subsequent completions.
Detail Nicholas, who lives on a small island east of Stornway, wants you to retrieve a memento of his lost Anabella, which he says was stolen by a man named Woody Nickitt.
Hint for solution Go to the house of Woody Nickitt (to the north) at night and try to speak to him while he's sleeping. He'll tell you that an Abyss diver stole the necklace. Sail along the west border of the world map until one of these beasts spawns. After the fight, one will drop a treasure chest containing a memento necklace. Take it back to Nicholas.
Repeatable Yes