Custom Field of type "Contact" is not recognizing the user's choice as valid

I have reproduced this in the public sandbox at: http://drupal.demo.civicrm.org/

I created a custom field named "paired with" for use with Contribution records. Then I click "Create new .... Contribution" and fill in the usual required fields. I also select another contact in the "paired with" field. But when I click "save" I get the following error message:

Please correct the following errors in the form fields below:

Select a valid contact for Paired With.