bzrlib.errors.MalformedTransform on merge

Merging between two fairly close branches gives this error.

$ b merge ~-
bzr: ERROR: bzrlib.errors.MalformedTransform: Tree transform is malformed [('unversioned parent', 'new-356'), ('missing parent', 'new-356')]

Traceback (most recent call last):
  File "/Library/Python/2.6/site-packages/bzrlib/commands.py", line 920, in exception_to_return_code
    return the_callable(*args, **kwargs)
  File "/Library/Python/2.6/site-packages/bzrlib/commands.py", line 1131, in run_bzr
    ret = run(*run_argv)
  File "/Library/Python/2.6/site-packages/bzrlib/commands.py", line 673, in run_argv_aliases
    return self.run(**all_cmd_args)
  File "/Library/Python/2.6/site-packages/bzrlib/commands.py", line 695, in run
    return self._operation.run_simple(*args, **kwargs)
  File "/Library/Python/2.6/site-packages/bzrlib/cleanup.py", line 136, in run_simple
    self.cleanups, self.func, *args, **kwargs)
  File "/Library/Python/2.6/site-packages/bzrlib/cleanup.py", line 166, in _do_with_cleanups
    result = func(*args, **kwargs)
  File "/Library/Python/2.6/site-packages/bzrlib/builtins.py", line 4460, in run
    verified)
  File "/Library/Python/2.6/site-packages/bzrlib/builtins.py", line 4479, in _do_merge
    conflict_count = merger.do_merge()
  File "/Library/Python/2.6/site-packages/bzrlib/merge.py", line 686, in do_merge
    merge = operation.run_simple()
  File "/Library/Python/2.6/site-packages/bzrlib/cleanup.py", line 136, in run_simple
    self.cleanups, self.func, *args, **kwargs)
  File "/Library/Python/2.6/site-packages/bzrlib/cleanup.py", line 166, in _do_with_cleanups
    result = func(*args, **kwargs)
  File "/Library/Python/2.6/site-packages/bzrlib/merge.py", line 654, in _do_merge_to
    merge.do_merge()
  File "/Library/Python/2.6/site-packages/bzrlib/merge.py", line 802, in do_merge
    operation.run()
  File "/Library/Python/2.6/site-packages/bzrlib/cleanup.py", line 132, in run
    self.cleanups, self.func, self, *args, **kwargs)
  File "/Library/Python/2.6/site-packages/bzrlib/cleanup.py", line 166, in _do_with_cleanups
    result = func(*args, **kwargs)
  File "/Library/Python/2.6/site-packages/bzrlib/merge.py", line 807, in _do_merge
    self._compute_transform()
  File "/Library/Python/2.6/site-packages/bzrlib/merge.py", line 857, in _compute_transform
    self._finish_computing_transform()
  File "/Library/Python/2.6/site-packages/bzrlib/merge.py", line 867, in _finish_computing_transform
    lambda t, c: transform.conflict_pass(t, c, self.other_tree))
  File "/Library/Python/2.6/site-packages/bzrlib/transform.py", line 3033, in resolve_conflicts
    raise MalformedTransform(conflicts=conflicts)
MalformedTransform: Tree transform is malformed [('unversioned parent', 'new-356'), ('missing parent', 'new-356')]

bzr 2.5.1 on python 2.6.7 (Darwin-12.2.0-x86_64-i386-64bit)
arguments: ['/usr/local/bin/bzr', 'merge',
    '/Users/guy/dev/repo.bzr.2/am-8.2.2.co']
plugins: bash_completion[2.5.1], bzr_grep[0.4.0], bzrtools[2.5.0],
    changelog_merge[2.5.1], colo[0.4.0], diff_revid[unknown], email[unknown],
    explorer[1.2.2], extcommand[unknown], extmerge[unknown],
    fastimport[0.14.0dev], git[0.6.8], keychain[0.1.0], launchpad[2.5.1],
    loom[2.2.0], netrc_credential_store[2.5.1], news_merge[2.5.1],
    pipeline[1.4.0], po_merge[2.5.1], qbzr[0.22.3], rewrite[0.6.3],
    stats[0.2.0dev], upload[1.1.0], weave_fmt[2.5.1], xmloutput[0.8.8]
encoding: 'utf-8', fsenc: 'utf-8', lang: 'en_US.UTF-8'

*** Bazaar has encountered an internal error. This probably indicates a
    bug in Bazaar. You can help us fix it by filing a bug report at
        https://bugs.launchpad.net/bzr/+filebug
    including this traceback and a description of the problem.