Exactly, Jimfive. Although you can also do it with an enemy attack... it is more 'fun' when you work with an ally to pull this off.

That just made me think of a situation where you have an ally attack you so you can disband and redeploy.

Yes... chance is, of course, correct. Sometimes this allows for a fun and sneaky maneuver that allows you to bring a unit from the front back to defend your home SC's quickly.

Disbands happen during the retreat phase, right before the build phase, so yes, you absolutely can disband an obsolete army and build a new one in your home SC

Does disbanding happen before building?

If I have to retreat and choose to disband does that allow me another build (assuming I have enough SCs to build)?

The idea being that this would allow me to redeploy a remote army back to my home territory.