set LOCAL visibility for local functions

(it can't be INHERIT)

compiler/frontend/src/org/jetbrains/jet/lang/resolve/DeclarationsChecker.java

@@ -265,6 +265,9 @@ public class DeclarationsChecker {
         if (function.getBodyExpression() == null && !hasAbstractModifier) {
             trace.report(NON_MEMBER_FUNCTION_NO_BODY.on(function, functionDescriptor));
         }
+        if (function.hasModifier(JetTokens.OVERRIDE_KEYWORD)) {
+            trace.report(ILLEGAL_MODIFIER.on(function.getModifierList().getModifierNode(JetTokens.OVERRIDE_KEYWORD).getPsi(), JetTokens.OVERRIDE_KEYWORD));
+        }
     }
 
     private void checkAccessors(@NotNull JetProperty property, @NotNull PropertyDescriptor propertyDescriptor) {

compiler/frontend/src/org/jetbrains/jet/lang/resolve/DescriptorResolver.java

@@ -49,6 +49,7 @@ import java.util.*;
 
 import static org.jetbrains.jet.lang.diagnostics.Errors.*;
 import static org.jetbrains.jet.lang.resolve.BindingContext.CONSTRUCTOR;
+import static org.jetbrains.jet.lexer.JetTokens.OVERRIDE_KEYWORD;
 
 /**
  * @author abreslav
@@ -273,7 +274,7 @@ public class DescriptorResolver {
         }
         boolean hasBody = function.getBodyExpression() != null;
         Modality modality = ModifiersChecker.resolveModalityFromModifiers(function, getDefaultModality(containingDescriptor, hasBody));
-        Visibility visibility = ModifiersChecker.resolveVisibilityFromModifiers(function);
+        Visibility visibility = ModifiersChecker.resolveVisibilityFromModifiers(function, getDefaultVisibility(function, containingDescriptor));
         JetModifierList modifierList = function.getModifierList();
         boolean isInline = (modifierList != null) && modifierList.hasModifier(JetTokens.INLINE_KEYWORD);
         functionDescriptor.initialize(
@@ -290,6 +291,23 @@ public class DescriptorResolver {
         return functionDescriptor;
     }
 
+    public static Visibility getDefaultVisibility(JetModifierListOwner modifierListOwner, DeclarationDescriptor containingDescriptor) {
+        Visibility defaultVisibility;
+        if (containingDescriptor instanceof ClassDescriptor) {
+            JetModifierList modifierList = modifierListOwner.getModifierList();
+            defaultVisibility = modifierList != null && modifierList.hasModifier(OVERRIDE_KEYWORD)
+                                           ? Visibilities.INHERITED
+                                           : Visibilities.INTERNAL;
+        }
+        else if (containingDescriptor instanceof FunctionDescriptor) {
+            defaultVisibility = Visibilities.LOCAL;
+        }
+        else {
+            defaultVisibility = Visibilities.INTERNAL;
+        }
+        return defaultVisibility;
+    }
+
     public static Modality getDefaultModality(DeclarationDescriptor containingDescriptor, boolean isBodyPresent) {
         Modality defaultModality;
         if (containingDescriptor instanceof ClassDescriptor) {

compiler/testData/diagnostics/tests/declarationChecks/localFunctionNoInheritVisibility.kt

@@ -0,0 +1,16 @@
+package d
+
+class T {
+    fun baz() = 1
+}
+
+<!ILLEGAL_MODIFIER!>override<!> fun zzz() {}
+
+fun foo(t: T) {
+    <!ILLEGAL_MODIFIER!>override<!> fun T.baz() = 2
+
+    // was "Visibility is unknown yet exception"
+    t.baz()
+
+    zzz()
+}

compiler/tests/org/jetbrains/jet/checkers/JetDiagnosticsTestGenerated.java

@@ -1103,6 +1103,11 @@ public class JetDiagnosticsTestGenerated extends AbstractDiagnosticsTestWithEage
                 doTest("compiler/testData/diagnostics/tests/declarationChecks/localDeclarationModifiers.kt");
             }
             
+            @TestMetadata("localFunctionNoInheritVisibility.kt")
+            public void testLocalFunctionNoInheritVisibility() throws Exception {
+                doTest("compiler/testData/diagnostics/tests/declarationChecks/localFunctionNoInheritVisibility.kt");
+            }
+            
             @TestMetadata("LocalVariableWithNoTypeInformation.kt")
             public void testLocalVariableWithNoTypeInformation() throws Exception {
                 doTest("compiler/testData/diagnostics/tests/declarationChecks/LocalVariableWithNoTypeInformation.kt");