What steps will reproduce the problem?

 * Create a symlink to a directory in your annex repository, like e.g. ~/Notes -> ~/annex/Notes
 * cd into ~/Notes
 * execute 'git annex sync <remote>', assuming that <remote> has made some changes

What is the expected output? What do you see instead?

If <remote> has made a change to, say, ~/annex/Documents/test.txt, the sync unexpectedly creates the new test.txt at ~/Notes/Documents/test.txt.
It should either magically figure out that it has to create the file relative to the repository's root (i.e. ~/annex) or throw an error instead.

What version of git-annex are you using? On what operating system?

git-annex version: 4.20130323
OS: Archlinux
Shell: zsh