The Initial Meeting:
* Bard's approach: Bard, a skilled archer and the rightful heir to the throne of Dale, initially sought a peaceful solution. He approached the dwarves, who had retaken their stronghold of Erebor, with a request for compensation for the destruction of their town by the dragon Smaug.
* Thorin's initial response: Thorin, blinded by greed and the desire for the dwarves' treasure, refused Bard's reasonable demands. He saw the Lake-men as insignificant and unworthy of sharing in the wealth of Erebor.
Escalation and Negotiation:
* The threat of force: Bard, desperate to rebuild his town and protect his people, rallied the Lake-men and prepared for war. The dwarves were caught off-guard, unprepared for a full-scale conflict.
* The arrival of Gandalf: The wise wizard Gandalf, who had orchestrated the events that led to the dragon's defeat, arrived and intervened. He reminded Thorin of his obligation to share the treasure fairly and convinced him of the need for a negotiated settlement.
* The "Council of the River" : Gandalf convened a meeting between the dwarves, the Lake-men, and representatives of other nearby regions to resolve the dispute. Bard presented his case with eloquence and passion, successfully demonstrating the Lake-men's need for restitution.
The Outcome:
* The "Treaty of Erebor": The Council reached a compromise, known as the "Treaty of Erebor". Thorin reluctantly agreed to share a portion of the treasure with the Lake-men, along with other parties, including the men of Dale.
* A lasting peace: The agreement allowed for a period of peace and reconstruction, although it was not without tension. The dwarves ultimately retained the majority of the treasure, while the Lake-men and others received a substantial amount to rebuild their lives.
In essence, the Lake-men and Bard employed a mix of negotiation and the threat of military action to approach Thorin's dwarves, ultimately achieving a peaceful resolution that acknowledged their rightful claims.