diff --git a/idea/src/org/jetbrains/jet/lang/annotations/LabelsAnnotator.java b/idea/src/org/jetbrains/jet/lang/annotations/LabelsAnnotator.java
index 3c2ef490239..c4a4d541ae7 100644
--- a/idea/src/org/jetbrains/jet/lang/annotations/LabelsAnnotator.java
+++ b/idea/src/org/jetbrains/jet/lang/annotations/LabelsAnnotator.java
@@ -5,6 +5,7 @@ package org.jetbrains.jet.lang.annotations;
 
 import com.intellij.lang.annotation.AnnotationHolder;
 import com.intellij.lang.annotation.Annotator;
+import com.intellij.openapi.application.ApplicationManager;
 import com.intellij.psi.PsiElement;
 import org.jetbrains.annotations.NotNull;
 import org.jetbrains.jet.lang.JetHighlighter;
@@ -16,6 +17,7 @@ import org.jetbrains.jet.lexer.JetTokens;
 
 public class LabelsAnnotator implements Annotator {
     public void annotate(@NotNull PsiElement element, @NotNull final AnnotationHolder holder) {
+        if (ApplicationManager.getApplication().isUnitTestMode()) return;
         element.accept(new JetVisitor() {
             @Override
             public void visitPrefixExpression(JetPrefixExpression expression) {
diff --git a/idea/src/org/jetbrains/jet/lang/cfg/JetControlFlowProcessor.java b/idea/src/org/jetbrains/jet/lang/cfg/JetControlFlowProcessor.java
index 74108942d7b..d2e54136d6c 100644
--- a/idea/src/org/jetbrains/jet/lang/cfg/JetControlFlowProcessor.java
+++ b/idea/src/org/jetbrains/jet/lang/cfg/JetControlFlowProcessor.java
@@ -110,6 +110,11 @@ public class JetControlFlowProcessor {
             value(expression.getExpression(), false);
         }
 
+        @Override
+        public void visitThisExpression(JetThisExpression expression) {
+            builder.readNode(expression);
+        }
+
         @Override
         public void visitConstantExpression(JetConstantExpression expression) {
             builder.readNode(expression);
diff --git a/idea/src/org/jetbrains/jet/lang/resolve/TopDownAnalyzer.java b/idea/src/org/jetbrains/jet/lang/resolve/TopDownAnalyzer.java
index a40150373e9..cba6e74c73d 100644
--- a/idea/src/org/jetbrains/jet/lang/resolve/TopDownAnalyzer.java
+++ b/idea/src/org/jetbrains/jet/lang/resolve/TopDownAnalyzer.java
@@ -1,5 +1,6 @@
 package org.jetbrains.jet.lang.resolve;
 
+import com.intellij.openapi.application.ApplicationManager;
 import org.jetbrains.annotations.NotNull;
 import org.jetbrains.jet.lang.JetSemanticServices;
 import org.jetbrains.jet.lang.cfg.JetControlFlowProcessor;
@@ -232,17 +233,20 @@ public class TopDownAnalyzer {
 
         JetExpression bodyExpression = function.getBodyExpression();
         if (bodyExpression != null) {
-            System.out.println("-------------");
             JetControlFlowInstructionsGenerator instructionsGenerator = new JetControlFlowInstructionsGenerator(function);
             new JetControlFlowProcessor(semanticServices, trace, instructionsGenerator).generate(function, bodyExpression);
             Pseudocode pseudocode = instructionsGenerator.getPseudocode();
             pseudocode.postProcess();
-            pseudocode.dumpInstructions(System.out);
-            System.out.println("-------------");
-            try {
-                pseudocode.dumpGraph(new PrintStream("/Users/abreslav/work/cfg.dot"));
-            } catch (FileNotFoundException e) {
-                e.printStackTrace();  //To change body of catch statement use File | Settings | File Templates.
+
+            if (!ApplicationManager.getApplication().isUnitTestMode()) {
+                System.out.println("-------------");
+                pseudocode.dumpInstructions(System.out);
+                System.out.println("-------------");
+                try {
+                    pseudocode.dumpGraph(new PrintStream("/Users/abreslav/work/cfg.dot"));
+                } catch (FileNotFoundException e) {
+                    e.printStackTrace();  //To change body of catch statement use File | Settings | File Templates.
+                }
             }
         }
     }
diff --git a/idea/src/org/jetbrains/jet/lang/types/JetTypeInferrer.java b/idea/src/org/jetbrains/jet/lang/types/JetTypeInferrer.java
index 1cd31571da2..e992cb10c30 100644
--- a/idea/src/org/jetbrains/jet/lang/types/JetTypeInferrer.java
+++ b/idea/src/org/jetbrains/jet/lang/types/JetTypeInferrer.java
@@ -264,6 +264,7 @@ public class JetTypeInferrer {
         };
     }
 
+    @Nullable
     private JetType getBlockReturnedType(@NotNull JetScope outerScope, @NotNull List<JetElement> block, @NotNull LabeledJumpDomain jumpDomain) {
         if (block.isEmpty()) {
             return JetStandardClasses.getUnitType();
@@ -416,7 +417,9 @@ public class JetTypeInferrer {
                 writableScope.setThisType(receiverType);
                 returnType = getBlockReturnedType(writableScope, body, LabeledJumpDomain.ERROR);
             }
-            result = JetStandardClasses.getFunctionType(null, receiverTypeRef == null ? null : receiverType, parameterTypes, returnType);
+            JetType effectiveReceiverType = receiverTypeRef == null ? null : receiverType;
+            JetType safeReturnType = returnType == null ? ErrorUtils.createErrorType("<return type>") : returnType;
+            result = JetStandardClasses.getFunctionType(null, effectiveReceiverType, parameterTypes, safeReturnType);
         }
 
         @Override
diff --git a/idea/testData/checker/BreakContinue.jet b/idea/testData/checker/BreakContinue.jet
new file mode 100644
index 00000000000..de5243502d8
--- /dev/null
+++ b/idea/testData/checker/BreakContinue.jet
@@ -0,0 +1,28 @@
+class C {
+
+    fun f (a : Boolean, b : Boolean) {
+        @b (while (true)
+          @a {
+            <error>break@f</error>
+            break
+            break@b
+            <error>break@a</error>
+          })
+
+        <error>continue</error>
+
+        @b (while (true)
+          @a {
+            <error>continue@f</error>
+            continue
+            continue@b
+            <error>continue@a</error>
+          })
+
+        <error>break</error>
+
+        <error>continue@f</error>
+        <error>break@f</error>
+    }
+
+}
\ No newline at end of file
diff --git a/idea/tests/org/jetbrains/jet/checkers/JetPsiCheckerTest.java b/idea/tests/org/jetbrains/jet/checkers/JetPsiCheckerTest.java
index fb257b919d0..d59db8f7704 100644
--- a/idea/tests/org/jetbrains/jet/checkers/JetPsiCheckerTest.java
+++ b/idea/tests/org/jetbrains/jet/checkers/JetPsiCheckerTest.java
@@ -31,4 +31,8 @@ public class JetPsiCheckerTest extends LightDaemonAnalyzerTestCase {
     public void testQualifiedThis() throws Exception {
         doTest("/checker/QualifiedThis.jet", true, true);
     }
+
+    public void testBreakContinue() throws Exception {
+        doTest("/checker/BreakContinue.jet", true, true);
+    }
 }