When you enter the town, you can go to the right, but a guy will pop up in the hole with a ladder in it, preventing you from passing. So, try and enter the town from the front. You'll get stopped whilst the guards check you, then you can pass. Apparently, pirates sacked their town and freed their leader, Briggs. Anyway, head on in. Use the Inn or Sanctum if you want, and buy any equipment if you need it. You'll need to go into the Inn anyway, because there's an item you can get. Head up the stairs, then go out onto the balcony. Jump across the roofs of the stalls where items, armour and weapons are being sold and you can reach a ledge where there's a chest. Equip it on whoever out of Jenna and Sheba has the lowest Defence. Hop back across and go back down through the Inn.
On the left-hand side of town, go down the ladder and enter the building. This is the jail. A man named Piers is here, who has been accused of being a Champa (the pirates who attacked Madra in the first place). He's innocent, but nobody except the Mayor of Madra and the Town Elder believes him. The guy in front of the cell takes it too far, annoys Piers, and gets a taste of Psynergy when Piers makes a puddle underneath him freeze into a pillar, knocking him over. Piers is a Mercury Adept as it turns out, although he won't be joining you for a while yet. Now may be a time to assign Mind Read to either L or R as you did with Move before. Mind Read Piers and he'll notice you're doing it - although he won't do anything.
Leave the jail. A random lady of some importance will appear to inspect the jail, to make sure Piers hasn't escaped. When she comes back out, she'll notice you and recognise you as travellers. In a completely random and impressive act of kindness, she'll allow your passage across Madra Drawbridge. That was convenient, wasn't it?
Now, head back to the hole outside the town walls that you couldn't pass earlier. Climb down to enter Madra Catacombs.