When talking with Sunzu the second time, you will presented with three choices. If you choose to pay him the 250gp, then the debt is paid. You can just outright kill him. Asking for "some other way", only results in having to make that decision between paying the gold yourself or killing Sunzu. If you choose to not pay the money, several enemy mobs spawn and attack you with Sunzu although with a decent party it should be extremely easy.