diff --git a/jaxb-ri/runtime/impl/src/main/java/com/sun/xml/bind/v2/runtime/property/PropertyFactory.java b/jaxb-ri/runtime/impl/src/main/java/com/sun/xml/bind/v2/runtime/property/PropertyFactory.java
index 616f9b827..2563ce4a7 100644
--- a/jaxb-ri/runtime/impl/src/main/java/com/sun/xml/bind/v2/runtime/property/PropertyFactory.java
+++ b/jaxb-ri/runtime/impl/src/main/java/com/sun/xml/bind/v2/runtime/property/PropertyFactory.java
@@ -44,6 +44,7 @@
 import java.lang.reflect.InvocationTargetException;
 import java.util.Collection;
 
+import com.sun.xml.bind.v2.model.core.ClassInfo;
 import com.sun.xml.bind.v2.model.core.ID;
 import com.sun.xml.bind.v2.model.core.PropertyKind;
 import com.sun.xml.bind.v2.model.runtime.RuntimeAttributePropertyInfo;
@@ -152,6 +153,9 @@ static boolean isLeaf(RuntimePropertyInfo info) {
         RuntimeTypeInfo rti = types.iterator().next();
         if(!(rti instanceof RuntimeNonElement)) return false;
 
+        //if hasSubClasses it's not a leaf and we can't optimize, see #1135
+        if (rti instanceof ClassInfo && ((ClassInfo) rti).hasSubClasses()) return false;
+
         if(info.id()==ID.IDREF)
             // IDREF is always handled as leaf -- Transducer maps IDREF String back to an object
             return true;