### Eclipse Workspace Patch 1.0
#P org.eclipse.jdt.core
Index: compiler/org/eclipse/jdt/internal/compiler/lookup/TypeBinding.java
===================================================================
RCS file: /cvsroot/eclipse/org.eclipse.jdt.core/compiler/org/eclipse/jdt/internal/compiler/lookup/TypeBinding.java,v
retrieving revision 1.106
diff -u -r1.106 TypeBinding.java
--- compiler/org/eclipse/jdt/internal/compiler/lookup/TypeBinding.java	2 Oct 2009 20:04:28 -0000	1.106
+++ compiler/org/eclipse/jdt/internal/compiler/lookup/TypeBinding.java	2 Dec 2009 18:33:33 -0000
@@ -854,18 +854,22 @@
 			case Binding.INTERSECTION_TYPE:
 			case Binding.GENERIC_TYPE:
 				return false;
-				case Binding.PARAMETERIZED_TYPE:
+			case Binding.PARAMETERIZED_TYPE:
 				if (current.isBoundParameterizedType())
 					return false;
 				break;
 			case Binding.RAW_TYPE:
 				return true;
 		}
-		if (current.isStatic())
+		if (current.isStatic()) {
 			return true;
+		}
 		if (current.isLocalType()) {
-			NestedTypeBinding nestedType = (NestedTypeBinding) current.erasure();
-			if (nestedType.scope.methodScope().isStatic) return true;
+			LocalTypeBinding localTypeBinding = (LocalTypeBinding) current.erasure();
+			MethodBinding enclosingMethod = localTypeBinding.enclosingMethod;
+			if (enclosingMethod != null && enclosingMethod.isStatic()) {
+				return true;
+			}
 		}
 	} while ((current = current.enclosingType()) != null);
 	return true;
#P org.eclipse.jdt.core.tests.model
Index: src/org/eclipse/jdt/core/tests/dom/ASTConverterTestAST3_2.java
===================================================================
RCS file: /cvsroot/eclipse/org.eclipse.jdt.core.tests.model/src/org/eclipse/jdt/core/tests/dom/ASTConverterTestAST3_2.java,v
retrieving revision 1.168
diff -u -r1.168 ASTConverterTestAST3_2.java
--- src/org/eclipse/jdt/core/tests/dom/ASTConverterTestAST3_2.java	26 Nov 2009 16:19:53 -0000	1.168
+++ src/org/eclipse/jdt/core/tests/dom/ASTConverterTestAST3_2.java	2 Dec 2009 18:33:35 -0000
@@ -122,7 +122,7 @@
 	static {
 //		TESTS_NAMES = new String[] {"test0602"};
 //		TESTS_RANGE = new int[] { 713, -1 };
-//		TESTS_NUMBERS =  new int[] { 710, 711 };
+//		TESTS_NUMBERS =  new int[] { 718 };
 	}
 	public static Test suite() {
 		return buildModelTestSuite(ASTConverterTestAST3_2.class);
@@ -10496,4 +10496,33 @@
 			}
 		});
 	}
+	//https://bugs.eclipse.org/bugs/show_bug.cgi?id=296629
+	public void test0718() throws JavaModelException {
+		ICompilationUnit workingCopy = null;
+		try {
+			workingCopy = getWorkingCopy("/Converter/src/X.java", true/*resolve*/);
+			String contents =
+				"public class X {\n" + 
+				"	public void v() {\n" + 
+				"		class Test2 {}\n" + 
+				"		Test2 t = get();\n" + 
+				"		t.toString();\n" + 
+				"	}\n" + 
+				"	public Object get() {return null;}\n" + 
+				"}";
+	
+			CompilationUnit unit = (CompilationUnit) buildAST(
+					contents,
+					workingCopy,
+					false);
+			VariableDeclarationStatement statement = (VariableDeclarationStatement) getASTNode(unit, 0, 0, 1);
+			ITypeBinding typeBinding = statement.getType().resolveBinding();
+			ITypeBinding typeBinding2 = ((VariableDeclarationFragment) statement.fragments().get(0)).getInitializer().resolveTypeBinding();
+			assertTrue("Is not cast compatible", typeBinding.isCastCompatible(typeBinding2));
+		} finally {
+			if (workingCopy != null) {
+				workingCopy.discardWorkingCopy();
+			}
+		}
+	}
 }
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