When you no longer need to refer to someone by their last name. Usally used when 1. two enemies (particuarly Jocks) are trying to end a fight or if 2. an adult wants you to call them by their first name.
Draco Malfoy: Hey Harry
Harry Potter: What so now we're on first name basis?
you: You have a beutiful house Mrs. Smith
Mrs. Smith: Call me Wanda.
You: Oookay that's a little strange
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