The valley is an isolated area surrounded by a mountain range known as the Wyrm Folk Mountains. It is populated by humans and "changelings" (humans with the blood of the Fair Folk in them). Originally the humans were united as one people, and the land they lived on was a gift from the Fair Folk. The Fair Folk are the owners of the land, and the humans are allowed to live there free of charge so long as they respect it and each other.
Of course, there was a catch. While the valley was the domain of the Fair Folk, the mountains were the domain of dragons. It was understood, however, that the Fair Folk would protect the humans from the dragons as long as they respected their territory.
It was rare that the dragons were even seen. Once every other generation (sometimes sooner, sometimes longer), though, some dragons were seen overhead for a brief period. They would leave the valley and some time later would re-appear to return to their mountain home. It was the belief of the humans that the sighting of dragons meant that there was a war elsewhere in the world. The number of dragons sighted and the length of time they were gone for corresponded to the severity of the war.
However, peace prospered in the valley for several generations. The humans respected the land and the Fair Folk were apparently pleased. A utopian society was formed, with no central leadership and no necessary system of justice as all respected one another.
Inexplicably, this had changed. A small (but rapidly growing) group had formed amongst the humans. It was said that they had taken to living in the mountains despite the warnings of the Fair Folk. They traveled across the valley, growing in number as they went, and declared themselves the rulers of the valley. A government was forming, and the peace-loving denizens of the valley had no way to stop it. They complied, and the valley was ruled by dictatorship for many years. Currency was issued, in the form of silver coins and copper coins (called "rams" and "kids", respectively). Weapons were forged and a military started, mostly used as a police force to enforce the laws of the dictator.
While the Fair Folk did not directly intervene (as it was not their way to do so), they encouraged the humans to put a stop to this dangerous government, lest they lose the right to live in the valley.
Dragons flew overhead and this time the war started in the valley. The humans fought amongst each other for years, and finally a resolution was made. The dictator was removed from power and a new "government" was formed by the humans. From this point forward, there was to be no one ruler in the valley. The people were divided into four tribes: the plains tribes (who were further divided into clans), the forest tribe, the mountain tribe (which consisted mostly of members of the former dictatorship), and the lake tribe (who is now known as the lost tribe, as they have not been heard from or seen since the dissolution). As the tyranny was enforced by weapons and armor of metal, from this point on the wielding of such items would be considered an act of war. Tribes were to enforce their own laws by a council of elders to be elected by the members of said tribes. The only restriction on this is that the worst punishment that could be inflicted was banishment. Putting a human to death was not to be the decision of humans - let the valley determine their fate. The only remnant of the former government to remain was the use of currency.
(to be contnued in Current History)