While the truce thing doesn't have anything to do with a city getting stuck at loyalty of 1, it is also a well-known issue where someone truced first, then while still in truce, applied Holiday mode.
When this happens, the city remains as "truce", but any valleys that they player owns will display "Holiday". The city status showing truce is what is called a "minor cosmetic issue", meaning it has absolutely nothing to do with anyone trying to exploit anything, and is only a "bug" in the sense that the status of the city is not updated properly. If it were updated properly to say "Holiday" instead of "Truce", other players still could not attack the city / cities in question, as both Truce and Holiday prevent additional attacks from being started.



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