I arrived to the end of the race way ahead of everyone, but nothing is happening. When the other riders come next to me, they win, and the quest is failed. The marker is on the spot where I am, and the quest description says I should go back to the start. And in fact the compass shows that I am in the designated area, but no matter how much I move around, nothing happens. Picking a fight with Divish (aimed bow at him) and yielding doesn’t help.
The quest log has these entries in it after the quest fails and after I speak to Sir Divish, among others, in that order:
I won! I am the champion of the famed Talmberg Races!
Unfortunately I didn’t do very well in the race. […]
This is on version 1.2 (PC).