Many centuries ago his clan was attacked by a group of humans. They captured his daughter and son. His boy was tortured to death and his daughter was raped and commited suicide after discovering she's pregnant. Zathrian wanted a bloody revenge for those atrocities, so he summoned a spirit he sealed in a wolf. That's how Witherfang was made. The beast was unleashed to those humans and killed many of them but survivors became feral werewolves.
However the werewolves attacked his clan again to force him to lift the curse. Zathrian didn't want this out of his hatred to them and the curse was also keeping him alive unnaturally long even for an elf. The protagonist of the game can help the werewolves in wiping out Zathrian and his clan, help Zathrian in killing the werewolves or force him to lift the curse and causing his death.