When Commanders of two or more unallied sides inhabit the same hex, rather than initiating a combat (or even after combat has been initiated) they may order their units to cease hostilities. From this position of non-aggression, a Commander may call for Parley.
A Parley is a discussion of terms for the cessation of hostility between the commanders. Unlike creation or dissolution of alliances, which is the domain of Rulers, these talks can be done by a Commander independently of his Ruler, though still under the auspices of Duty, Loyalty, and Obedience.
A Commander ordered to fight to the death could not take part in a parley (unless he had low loyalty and duty). But, without consulting his Ruler, a Commander could take his force out of a contested hex he had been ordered to defend, give up a ransom, or even surrender, if he thought it in his Ruler or side's best interest.