While much of Palurin remained at relative peace during the 340s and 350s, excepting the chaos - high elf war and the never ending barbarity of the Kaalroen Empire, the Lizardmen Empire of Cuitlaxaochitzin continued its aggressive policies of expansion. Much of this expansion was in raw wealth, and the riches of Cacauaxochitl overflowed as the armies of the realm plundered the riches of Armeren. A major battle was fought in 342PC after daemons were encountered abroad north of the Lizardmen realm, converting many of the human tribes to their worship. The Lizardmen defeated the daemonic host, massing further riches from the "sacrifices" the daemons had been offered.
The realm's new found wealth was jealously horded by the Slaan of Cacauaxochitl, who wished it to be used for the greatness of the entire realm, and for the furthering of their purposes on Palurin, but the Ogres of Graag took exception to this. They demanded an equal share of the booty, since they had done an equal share of the fighting, but the Slaan refused. This led to the civil war of 352, which led to a financial settlement being reached between Graag and the Lizardmen capital.
In 353PC, stronger than ever before, and richer, the Lizardmen no longer felt the need to continue their treaty with the far High Elf realm of Mellvellon, and demanded ever higher taxes from the high elf trade fleet. Angered by this the Dragon Lords mustered a large army, and using their overwhelming sea power, set sail for the Lizardmen domain. The Lizardmen were shocked to find a High Elf army marching up the Laerthad river, and their own forces were soundly beaten just to the north of Tacapantzin. The high elves marched into Cacauaxochitl, forced the Slaan to renew the trade treaty and then left, before large armies from Hor'takn and Graag could cut them off from the fleet.