diff --git a/change_log.txt b/change_log.txt
index 344aa65c..17f3ffa2 100644
--- a/change_log.txt
+++ b/change_log.txt
@@ -1,4 +1,7 @@
  ===== 3.1.30-dev ===== (xx.xx.xx)
+ 27.12.2015
+  - improve inheritance code
+ 
  25.12.2015
   - compile {block} tag code and its processing into classes
   - optimization replace hhvm extension by inline code
diff --git a/libs/Smarty.class.php b/libs/Smarty.class.php
index 9bee638e..c8057428 100644
--- a/libs/Smarty.class.php
+++ b/libs/Smarty.class.php
@@ -118,7 +118,7 @@ class Smarty extends Smarty_Internal_TemplateBase
     /**
      * smarty version
      */
-    const SMARTY_VERSION = '3.1.30-dev/9';
+    const SMARTY_VERSION = '3.1.30-dev/10';
 
     /**
      * define variable scopes
diff --git a/libs/sysplugins/smarty_internal_block.php b/libs/sysplugins/smarty_internal_block.php
index 375ce34a..d00b14a6 100644
--- a/libs/sysplugins/smarty_internal_block.php
+++ b/libs/sysplugins/smarty_internal_block.php
@@ -67,54 +67,61 @@ class Smarty_Internal_Block
 
     /**
      * Smarty_Internal_Block constructor.
+     * - if outer level {block} of child template ($state == 1) save it as child root block
+     * - otherwise process inheritance and render
      *
-     * @param \Smarty_Internal_Template $_smarty_tpl
-     *
+     * @param \Smarty_Internal_Template $tpl
+     * @param int|null                  $tplIndex index of outer level {block} if nested
      */
-    public function __construct(Smarty_Internal_Template $_smarty_tpl)
+    public function __construct(Smarty_Internal_Template $tpl, $tplIndex = null)
     {
-        $this->tplIndex = $_smarty_tpl->ext->_inheritance->tplIndex;
-        if (isset($_smarty_tpl->ext->_inheritance->blockParameter[ $this->name ])) {
-            $this->child = $_smarty_tpl->ext->_inheritance->blockParameter[ $this->name ];
+        $this->tplIndex = $tplIndex ? $tplIndex : $tpl->ext->_inheritance->tplIndex;
+        if (isset($tpl->ext->_inheritance->childRoot[ $this->name ])) {
+            $this->child = $tpl->ext->_inheritance->childRoot[ $this->name ];
         }
-        if ($_smarty_tpl->ext->_inheritance->state == 1) {
-            $_smarty_tpl->ext->_inheritance->blockParameter[ $this->name ] = $this;
+        if ($tpl->ext->_inheritance->state == 1) {
+            $tpl->ext->_inheritance->childRoot[ $this->name ] = $this;
             return;
         }
-        $this->process($_smarty_tpl);
+        // make sure we got child block of child template of current block
+        while ($this->child && $this->tplIndex <= $this->child->tplIndex) {
+            $this->child = $this->child->child;
+        }
+        $this->process($tpl);
     }
 
     /**
      * Goto child block or render this
      *
-     * @param \Smarty_Internal_Template   $_smarty_tpl
+     * @param \Smarty_Internal_Template   $tpl
      * @param \Smarty_Internal_Block|null $parent
      */
-    public function process(Smarty_Internal_Template $_smarty_tpl, Smarty_Internal_Block $parent = null) {
+    public function process(Smarty_Internal_Template $tpl, Smarty_Internal_Block $parent = null)
+    {
         if ($this->hide && !isset($this->child)) {
-             return;
+            return;
         }
         if (isset($this->child) && $this->child->hide && !isset($this->child->child)) {
             $this->child = null;
         }
         $this->parent = $parent;
         if ($this->append && !$this->prepend && isset($parent)) {
-            $this->callParent($_smarty_tpl);
+            $this->callParent($tpl);
         }
         if ($this->callsChild || !isset($this->child) || ($this->child->hide && !isset($this->child->child))) {
-            $this->callBlock($_smarty_tpl);
+            $this->callBlock($tpl);
         } else {
-            $this->child->process($_smarty_tpl, $this);
+            $this->child->process($tpl, $this);
         }
         if ($this->prepend && isset($parent)) {
-            $this->callParent($_smarty_tpl);
+            $this->callParent($tpl);
             if ($this->append) {
                 if ($this->callsChild || !isset($this->child) || ($this->child->hide && !isset($this->child->child))) {
-                    $this->callBlock($_smarty_tpl);
+                    $this->callBlock($tpl);
                 } else {
-                    $this->child->process($_smarty_tpl, $this);
+                    $this->child->process($tpl, $this);
                 }
-           }
+            }
         }
         $this->parent = null;
     }
@@ -122,34 +129,37 @@ class Smarty_Internal_Block
     /**
      * Compiled block code overloaded by {block} class
      *
-     * @param \Smarty_Internal_Template   $_smarty_tpl
+     * @param \Smarty_Internal_Template $tpl
      */
-    public function callBlock(Smarty_Internal_Template $_smarty_tpl) {
+    public function callBlock(Smarty_Internal_Template $tpl)
+    {
     }
 
     /**
      * Render child on {$smarty.block.child}
      *
-     * @param \Smarty_Internal_Template $_smarty_tpl
+     * @param \Smarty_Internal_Template $tpl
      */
-    public function callChild (Smarty_Internal_Template $_smarty_tpl) {
+    public function callChild(Smarty_Internal_Template $tpl)
+    {
         if (isset($this->child)) {
-            $this->child->process($_smarty_tpl, $this);
+            $this->child->process($tpl, $this);
         }
     }
 
     /**
      * Render parent on {$smarty.block.parent} or {block append/prepend}     *
      *
-     * @param \Smarty_Internal_Template   $_smarty_tpl
+     * @param \Smarty_Internal_Template $tpl
      *
      * @throws \SmartyException
      */
-    public function callParent (Smarty_Internal_Template $_smarty_tpl) {
+    public function callParent(Smarty_Internal_Template $tpl)
+    {
         if (isset($this->parent)) {
-            $this->parent->callBlock($_smarty_tpl, $this->parent->parent);
+            $this->parent->callBlock($tpl);
         } else {
-            throw new SmartyException("inheritance: illegal {\$smarty.block.parent} or {block append/prepend} used in parent template '{$_smarty_tpl->ext->_inheritance->compiledFilePath[$this->tplIndex]}' block '{$this->name}'");
+            throw new SmartyException("inheritance: illegal {\$smarty.block.parent} or {block append/prepend} used in parent template '{$tpl->ext->_inheritance->templateResource[$this->tplIndex]}' block '{$this->name}'");
         }
     }
 }
\ No newline at end of file
diff --git a/libs/sysplugins/smarty_internal_compile_block.php b/libs/sysplugins/smarty_internal_compile_block.php
index d2e63ee2..0d897b5f 100644
--- a/libs/sysplugins/smarty_internal_compile_block.php
+++ b/libs/sysplugins/smarty_internal_compile_block.php
@@ -235,7 +235,7 @@ class Smarty_Internal_Compile_Blockclose extends Smarty_Internal_Compile_Shared_
         if ($compiler->_cache[ 'blockNesting' ] == 1) {
             $output .= "new {$_className}(\$_smarty_tpl);\n";
         } else {
-            $output .= "new {$_className}(\$_smarty_tpl);\n";
+            $output .= "new {$_className}(\$_smarty_tpl, \$this->tplIndex);\n";
         }
         $output .= "?>\n";
         $compiler->_cache[ 'blockNesting' ] --;
diff --git a/libs/sysplugins/smarty_internal_runtime_inheritance.php b/libs/sysplugins/smarty_internal_runtime_inheritance.php
index 64ae5db7..7e85dd59 100644
--- a/libs/sysplugins/smarty_internal_runtime_inheritance.php
+++ b/libs/sysplugins/smarty_internal_runtime_inheritance.php
@@ -24,11 +24,11 @@ class Smarty_Internal_Runtime_Inheritance
     public $state = 0;
 
     /**
-     * Array of block parameter of known {block} tags
+     * Array of root child {block} objects
      *
-     * @var array
+     * @var Smarty_Internal_Block[]
      */
-    public $blockParameter = array();
+    public $childRoot = array();
 
     /**
      * inheritance template nesting level
@@ -45,20 +45,12 @@ class Smarty_Internal_Runtime_Inheritance
     public $tplIndex = - 1;
 
     /**
-     * Array of compiled template file path
+     * Array of source template names
      * - key template index
-     * only used when caching is enabled
      *
-     * @var []string
+     * @var string[]
      */
-    public $compiledFilePath = array();
-
-    /**
-     * Current {block} nesting level
-     *
-     * @var int
-     */
-    public $blockNesting = 0;
+    public $templateResource = array();
 
     /**
      * Initialize inheritance
@@ -70,8 +62,8 @@ class Smarty_Internal_Runtime_Inheritance
      */
     public function init(Smarty_Internal_Template $tpl, $initChild, $blockNames = array())
     {
-        // if template was from an inner block or template is a parent template create new inheritance root
-        if ($initChild && ($this->blockNesting || $this->state == 3)) {
+        // if called while executing parent template it must be a sub-template with new inheritance root
+        if ($initChild && $this->state == 3) {
             $tpl->ext->_inheritance = new Smarty_Internal_Runtime_Inheritance();
             $tpl->ext->_inheritance->init($tpl, $initChild, $blockNames);
             return;
@@ -88,7 +80,7 @@ class Smarty_Internal_Runtime_Inheritance
         // in parent state {include} will not increment template index
         if ($this->state != 3) {
             $this->tplIndex ++;
-            $this->compiledFilePath[ $this->tplIndex ] = $tpl->template_resource;
+            $this->templateResource[ $this->tplIndex ] = $tpl->template_resource;
         }
         // if state was waiting for parent change state to parent
         if ($this->state == 2) {