To reproduce the problem: 1) Set AllowHoldsOnDamagedItems to Don't allow 2) Place an item on hold for patron 3) Mark it as in mending (damaged) (staff notice it needs repair when returned) 4) Patron picks up the item and it is checked out to the patron 5) Notice the item is checked out to the patron, but also showing in mending, and still waiting for that patron. While some would say this could be avoided by workflow changes, it is still a data problem that leads to confusion for all involved. I would suggest that 1) the hold waiting not allow status changes, or 2) the hold allow the waiting status to be changed for this scenario. It seems that AllowHoldsOnDamagedItems should only block holds from being placed, not holds that are already waiting. I don't think blocking the checkout of the item that is already waiting would be a good option because the patron has been notified that the item is already there.