--- a/ai/default/default.c	Sat May 20 17:33:36 2006 +0000
+++ b/ai/default/default.c	Sat May 20 17:35:11 2006 +0000
@@ -1620,8 +1620,9 @@
 
 			/* signals too? */
 			if (j&3) {
-				// Can't build signals on a road.
-				if (IsTileType(c, MP_STREET)) return CMD_ERROR;
+				/* XXX - we need to check manually whether we can build a signal if DC_EXEC is
+				   not set because the rail has not actually been built */
+				if (!IsTileType(c, MP_RAILWAY)) return CMD_ERROR;
 
 				if (flag & DC_EXEC) {
 					j = 4 - j;