Do you happen to have the main quest activated? You should be able to tap a dialogue button above it to start a duel.
Try checking the repair dialogue of the Forge building first. Might be that you haven't activated it yet.
3 years ago (+1)
that's odd been through 4 playthroughs in v0.6.5 with different preferences it should be working like this
any time of day should work as long as the quest repair forge is active. I would suggest trying it out on a different save slot though you might have to start all over again. If it still doesn't work them maybe there is something wrong with the game version you have installed. Also specify your game version and device you are playing in. It might help the developer pin point the problem better.