Problem with functional dependencies

[Marcin 'Qrczak' Kowalczyk]

The following module is rejected by both
    ghc -fglasgow-exts -fallow-undecidable-instances
and
    hugs -98

------------------------------------------------------------------------
class HasFoo a foo | a -> foo where
    foo :: a -> foo

data A = A Int
data B = B A

instance HasFoo A Int where
    foo (A x) = x

instance HasFoo A foo => HasFoo B foo where
    foo (B a) = foo a
------------------------------------------------------------------------

The error messsage says that the type inferred for foo in B's instance
is not general enough: the rhs has type "HasFoo B Int => B -> Int", but
"HasFoo B foo => B -> foo" was expected.

Should it really be wrong? I don't know the details of type inference
with fundeps, but intuitively it should work, yielding an instance
HasFoo B Int. Could it be made legal please?

With the fundep removed, it works.

I need it for a preprocessor which generates instances like that for B
without knowing the type to put as the second class argument. Fundeps
aren't essential, but...

-- 
 __("<  Marcin Kowalczyk * qrczak@knm.org.pl http://qrczak.ids.net.pl/
 \__/
  ^^                      SYGNATURA ZASTĘPCZA
QRCZAK