validateSubTypeByEntity breaks adding additional Multi-record custom values

This is similar to https://issues.civicrm.org/jira/browse/CRM-18504

We are experiencing the following error:

Sorry but we are not able to provide this at the moment.
Invalid Filter

When trying to add additional values to multi-record custom fields, on a Contact record. Here are the relevant parts of the backtrace:

CRM_Core_BAO_CustomGroup::validateSubTypeByEntity('Contact', 'Magistrate') - /CRM/Core/BAO/CustomGroup.php:440

CRM_Core_BAO_CustomGroup::getTree('Contact', Object(CRM_Contact_Form_CustomData), '130935', '1', 'Magistrate', null, true, null) - CRM/Custom/Form/CustomData.php:136

CRM_Custom_Form_CustomData::preProcess(Object(CRM_Contact_Form_CustomData), null, 'Magistrate', null, null, '130935') - /CRM/Contact/Form/CustomData.php:130

Steps to reproduce

1. Create custom fieldset against entity 'Contacts', set this to display as a tab, check "Does this Custom Field Set allow multiple records?", then add a custom field to this fieldset.
2. Next, go to a contact record and enter a value in this new custom fieldset and hit save
3. Try to create an additional record under this same fieldset

I have reproduced on D46 demo.