diff --git a/src/engine/net/client/handlers/DismissGuildHandler.java b/src/engine/net/client/handlers/DismissGuildHandler.java
index 5bdca79f..53cedcad 100644
--- a/src/engine/net/client/handlers/DismissGuildHandler.java
+++ b/src/engine/net/client/handlers/DismissGuildHandler.java
@@ -114,8 +114,14 @@ public class DismissGuildHandler extends AbstractClientMsgHandler {
 
         GuildManager.updateAllGuildTags(toDismiss);
 
-        if (nation.getSubGuildList().isEmpty())
-            nation.guildState = mbEnums.GuildState.Sovereign;
+        boolean isNation = false;
+
+        if (!nation.getSubGuildList().isEmpty())
+            for (Guild guild : nation.getSubGuildList())
+                if (guild.getOwnedCity() != null)
+                    isNation = true;
+
+        nation.guildState = isNation ? mbEnums.GuildState.Nation : mbEnums.GuildState.Sovereign;
 
         SendGuildEntryMsg msg = new SendGuildEntryMsg(player);
         dispatch = Dispatch.borrow(player, msg);