Steps to reproduce:
- Login as a user or admin
- Click on "Blog"
- Click on a blog post
- Click "Edit"
- Scroll down to the "Category" section
- Hover over a category and click on the tree icon next to it
- Fill in the new category name
- Click "Add"
The new category will not be added as a subcategory of the category where you clicked the tree icon, but instead will be added with no parent category.
Tested on IE9. Does not reproduce on Chrome 23, Firefox 17 and IE8.