diff --git a/compiler/frontend/src/org/jetbrains/jet/lang/resolve/calls/ValueArgumentsToParametersMapper.java b/compiler/frontend/src/org/jetbrains/jet/lang/resolve/calls/ValueArgumentsToParametersMapper.java
index f3284357758..1d683049e37 100644
--- a/compiler/frontend/src/org/jetbrains/jet/lang/resolve/calls/ValueArgumentsToParametersMapper.java
+++ b/compiler/frontend/src/org/jetbrains/jet/lang/resolve/calls/ValueArgumentsToParametersMapper.java
@@ -103,25 +103,11 @@ import static org.jetbrains.jet.lang.resolve.calls.ValueArgumentsToParametersMap
             }
         }
 
-        private final ProcessorState initial = new ProcessorState() {
-
-            @Override
-            public ProcessorState processNamedArgument(@NotNull ValueArgument argument) {
-                return namedOnly.processNamedArgument(argument);
-            }
-
-            @Override
-            public ProcessorState processPositionedArgument(
-                    @NotNull ValueArgument argument, int index
-            ) {
-                return positionedOnly.processPositionedArgument(argument, index);
-            }
-        };
-
+        // We saw only positioned arguments so far
         private final ProcessorState positionedOnly = new ProcessorState() {
             @Override
             public ProcessorState processNamedArgument(@NotNull ValueArgument argument) {
-                return error.processNamedArgument(argument);
+                return positionedThenNamed.processNamedArgument(argument);
             }
 
             @Override
@@ -159,7 +145,8 @@ import static org.jetbrains.jet.lang.resolve.calls.ValueArgumentsToParametersMap
             }
         };
 
-        private final ProcessorState namedOnly = new ProcessorState() {
+        // We saw zero or more positioned arguments and then a named one
+        private final ProcessorState positionedThenNamed = new ProcessorState() {
             @Override
             public ProcessorState processNamedArgument(@NotNull ValueArgument argument) {
                 assert argument.isNamed();
@@ -184,25 +171,7 @@ import static org.jetbrains.jet.lang.resolve.calls.ValueArgumentsToParametersMap
                     }
                 }
 
-                return namedOnly;
-            }
-
-            @Override
-            public ProcessorState processPositionedArgument(
-                    @NotNull ValueArgument argument, int index
-            ) {
-                return error.processPositionedArgument(argument, index);
-            }
-        };
-
-        private final ProcessorState error = new ProcessorState() {
-            @Override
-            public ProcessorState processNamedArgument(@NotNull ValueArgument argument) {
-                namedOnly.processNamedArgument(argument);
-
-                candidateCall.getTrace().report(MIXING_NAMED_AND_POSITIONED_ARGUMENTS.on(argument.getArgumentName()));
-                setStatus(WEAK_ERROR);
-                return error;
+                return positionedThenNamed;
             }
 
             @Override
@@ -211,12 +180,13 @@ import static org.jetbrains.jet.lang.resolve.calls.ValueArgumentsToParametersMap
             ) {
                 candidateCall.getTrace().report(MIXING_NAMED_AND_POSITIONED_ARGUMENTS.on(argument.asElement()));
                 setStatus(WEAK_ERROR);
-                return error;
+
+                return positionedThenNamed;
             }
         };
 
         public void process() {
-            ProcessorState state = initial;
+            ProcessorState state = positionedOnly;
             List<? extends ValueArgument> arguments = call.getValueArguments();
             for (int i = 0; i < arguments.size(); i++) {
                 ValueArgument valueArgument = arguments.get(i);
diff --git a/compiler/testData/codegen/box/defaultArguments/function/mixingNamedAndPositioned.kt b/compiler/testData/codegen/box/defaultArguments/function/mixingNamedAndPositioned.kt
new file mode 100644
index 00000000000..cb206b8d271
--- /dev/null
+++ b/compiler/testData/codegen/box/defaultArguments/function/mixingNamedAndPositioned.kt
@@ -0,0 +1,16 @@
+fun foo(a: String = "Default", b: Int = 1, c: Long = 2): String {
+  return "$a $b $c"
+}
+
+fun box(): String {
+  val test1 = foo("test1", 2, c = 3)
+  if (test1 != "test1 2 3") return test1
+
+  val test2 = foo("test2", c = 3)
+  if (test2 != "test2 1 3") return test2
+
+  val test3 = foo("test3", b = 3)
+  if (test3 != "test3 3 2") return test3
+
+  return "OK"
+}
\ No newline at end of file
diff --git a/compiler/testData/diagnostics/tests/NamedArgumentsAndDefaultValues.kt b/compiler/testData/diagnostics/tests/NamedArgumentsAndDefaultValues.kt
index a6a4a3753af..718923b2f21 100644
--- a/compiler/testData/diagnostics/tests/NamedArgumentsAndDefaultValues.kt
+++ b/compiler/testData/diagnostics/tests/NamedArgumentsAndDefaultValues.kt
@@ -18,8 +18,10 @@ fun test() {
     bar(""<!NO_VALUE_FOR_PARAMETER!>)<!>
     bar(1, 1, "")
     bar(1, 1, "")
-    bar(1, <!MIXING_NAMED_AND_POSITIONED_ARGUMENTS!>z<!> = "")
-    bar(1, <!NAMED_PARAMETER_NOT_FOUND, MIXING_NAMED_AND_POSITIONED_ARGUMENTS!>zz<!> = "",
+    bar(1, z = "")
+    bar(1, z = "", y = 2)
+    bar(z = "", <!MIXING_NAMED_AND_POSITIONED_ARGUMENTS!>1<!>)
+    bar(1, <!NAMED_PARAMETER_NOT_FOUND!>zz<!> = "",
            <!MIXING_NAMED_AND_POSITIONED_ARGUMENTS!><!UNRESOLVED_REFERENCE!>zz<!>.<!DEBUG_INFO_ELEMENT_WITH_ERROR_TYPE!>foo<!><!>
            <!NO_VALUE_FOR_PARAMETER!>)<!>
 }
\ No newline at end of file
diff --git a/compiler/testData/diagnostics/tests/checkArguments/kt1897_diagnostic_part.kt b/compiler/testData/diagnostics/tests/checkArguments/kt1897_diagnostic_part.kt
index b5f67ee5ab8..a285a9e0f0c 100644
--- a/compiler/testData/diagnostics/tests/checkArguments/kt1897_diagnostic_part.kt
+++ b/compiler/testData/diagnostics/tests/checkArguments/kt1897_diagnostic_part.kt
@@ -18,7 +18,7 @@ fun test() {
 
     foo(i = 1, <!ARGUMENT_PASSED_TWICE!>i<!> = 1, s = <!ERROR_COMPILE_TIME_VALUE!>11<!>)
 
-    foo(<!TYPE_MISMATCH!>""<!>, <!MIXING_NAMED_AND_POSITIONED_ARGUMENTS!>s<!> = <!ERROR_COMPILE_TIME_VALUE!>2<!>)
+    foo(<!TYPE_MISMATCH!>""<!>, s = <!ERROR_COMPILE_TIME_VALUE!>2<!>)
 
     foo(i = <!TYPE_MISMATCH!>""<!>, s = <!ERROR_COMPILE_TIME_VALUE!>2<!>, <!MIXING_NAMED_AND_POSITIONED_ARGUMENTS!>33<!>)
 
diff --git a/compiler/testData/diagnostics/tests/checkArguments/kt1940.kt b/compiler/testData/diagnostics/tests/checkArguments/kt1940.kt
index 9253288be94..8f4a4ce4193 100644
--- a/compiler/testData/diagnostics/tests/checkArguments/kt1940.kt
+++ b/compiler/testData/diagnostics/tests/checkArguments/kt1940.kt
@@ -4,6 +4,6 @@ package kt1940
 fun foo(<!UNUSED_PARAMETER!>i<!>: Int) {}
 
 fun test() {
-    foo(1, <!ARGUMENT_PASSED_TWICE, MIXING_NAMED_AND_POSITIONED_ARGUMENTS!>i<!> = 2) //exception
+    foo(1, <!ARGUMENT_PASSED_TWICE!>i<!> = 2) //exception
     foo(i = 1, <!ARGUMENT_PASSED_TWICE!>i<!> = 2) //exception
 }
\ No newline at end of file
diff --git a/compiler/tests/org/jetbrains/jet/codegen/generated/BlackBoxCodegenTestGenerated.java b/compiler/tests/org/jetbrains/jet/codegen/generated/BlackBoxCodegenTestGenerated.java
index e1d4f744868..b91084927d8 100644
--- a/compiler/tests/org/jetbrains/jet/codegen/generated/BlackBoxCodegenTestGenerated.java
+++ b/compiler/tests/org/jetbrains/jet/codegen/generated/BlackBoxCodegenTestGenerated.java
@@ -16,16 +16,13 @@
 
 package org.jetbrains.jet.codegen.generated;
 
-import junit.framework.Assert;
 import junit.framework.Test;
 import junit.framework.TestSuite;
-
-import java.io.File;
 import org.jetbrains.jet.JetTestUtils;
 import org.jetbrains.jet.test.InnerTestClasses;
 import org.jetbrains.jet.test.TestMetadata;
 
-import org.jetbrains.jet.codegen.generated.AbstractBlackBoxCodegenTest;
+import java.io.File;
 
 /** This class is generated by {@link org.jetbrains.jet.generators.tests.GenerateTests}. DO NOT MODIFY MANUALLY */
 @SuppressWarnings("all")
@@ -1345,6 +1342,11 @@ public class BlackBoxCodegenTestGenerated extends AbstractBlackBoxCodegenTest {
                 blackBoxFileByFullPath("compiler/testData/codegen/box/defaultArguments/function/innerExtentionFunctionDoubleTwoArgs.kt");
             }
             
+            @TestMetadata("mixingNamedAndPositioned.kt")
+            public void testMixingNamedAndPositioned() throws Exception {
+                blackBoxFileByFullPath("compiler/testData/codegen/box/defaultArguments/function/mixingNamedAndPositioned.kt");
+            }
+            
         }
         
         public static Test innerSuite() {