In 1003, Prince Gabriel, lord of the Phoenix, declared that he claimed Berkwald in place of the unpaid debt the Empire owed him for his contribution to the Battle for the Celtic Islands. The Imperial Council quickly responded with warnings of retribution if he continued his path.

Undeterred, the Phoenix began their march to Berkwald, promising that anyone who chaffed under the rule of Emperor Gar III and the imperial council was welcome in Berkwald. One person attracted by this offer was King Mordjambe, who had been claiming Berkwald was the ancestral lands of his people for many years.

The Empire responded by ransacking of the domains belonging to the Phoenix Guild and mandating Holy Order of the Iron Fist to crush the army of Prince Gabriel I in Berkwald and bring him back to the capital for his public execution. Some feared the Empire would break up over the council, especially given the already tense situation with the Imperial Council between Gorghor Bey and the Holy Order of the Iron Fist. With the True Faith Iron Fist declaring the self-proclaimed god, Gorghor Bey, was an anathema no unified imperial front could be raised (see Empire - Gorghor Bey)

The battles were bloody and the Phoenix and their allies were the winners. They consolidated their claim on Berkwald, fairly distributing the lands promised to their allies.

Sources:
Letter from Gab 1 asking to be paid
Letter from Imperial council to Gab 1
1004 - La Guerre de Berkwald