How I got the bug:
Your soverign and one of your heroes, who is close to leveling up, gets into combat with a single creature.
The combat auto-resolves without your input
Suddenly you get a level-up screen for Janus (the hero). !!!Yay, he lived (you think.)!!!
Then the combat resolution screen comes up showing that Janus is dead.
Then you can't hire another hero.