diff --git a/config/alfresco/model/contentModel.xml b/config/alfresco/model/contentModel.xml
index 58bfd9768f..a4ba842360 100644
--- a/config/alfresco/model/contentModel.xml
+++ b/config/alfresco/model/contentModel.xml
@@ -542,6 +542,11 @@
                <type>d:text</type>
                <protected>true</protected>
             </property>
+            <property name="cm:initialVersion">
+               <title>Initial Version</title>
+               <type>d:boolean</type>
+               <default>true</default>
+            </property>
             <property name="cm:autoVersion">
                <title>Auto Version</title>
                <type>d:boolean</type>
diff --git a/source/java/org/alfresco/model/ContentModel.java b/source/java/org/alfresco/model/ContentModel.java
index ba004acf68..c5855c46ac 100644
--- a/source/java/org/alfresco/model/ContentModel.java
+++ b/source/java/org/alfresco/model/ContentModel.java
@@ -106,6 +106,7 @@ public interface ContentModel
     // version aspect
 	static final QName ASPECT_VERSIONABLE = QName.createQName(NamespaceService.CONTENT_MODEL_1_0_URI, "versionable");
 	static final QName PROP_VERSION_LABEL = QName.createQName(NamespaceService.CONTENT_MODEL_1_0_URI, "versionLabel");
+    static final QName PROP_INITIAL_VERSION = QName.createQName(NamespaceService.CONTENT_MODEL_1_0_URI, "initialVersion");
     static final QName PROP_AUTO_VERSION = QName.createQName(NamespaceService.CONTENT_MODEL_1_0_URI, "autoVersion");
 
     // folders
diff --git a/source/java/org/alfresco/repo/version/VersionServiceImplTest.java b/source/java/org/alfresco/repo/version/VersionServiceImplTest.java
index b203751fa5..1f78d2876f 100644
--- a/source/java/org/alfresco/repo/version/VersionServiceImplTest.java
+++ b/source/java/org/alfresco/repo/version/VersionServiceImplTest.java
@@ -16,7 +16,9 @@
  */
 package org.alfresco.repo.version;
 
+import java.io.Serializable;
 import java.util.Collection;
+import java.util.HashMap;
 import java.util.Set;
 
 import org.alfresco.model.ContentModel;
@@ -435,19 +437,70 @@ public class VersionServiceImplTest extends BaseVersionStoreTest
     	
     }
     
-    public void testAutoVersion()
+    public void testAutoVersionOnInitialVersionOn()
     {
         // Create a versionable node
         final NodeRef versionableNode = createNewVersionableNode();
-
-        // Add some content 
-        ContentWriter contentWriter = this.contentService.getWriter(versionableNode, ContentModel.PROP_CONTENT, true);
-        assertNotNull(contentWriter);
-        contentWriter.putContent(UPDATED_CONTENT_1);
         
-        // Need to commit in order to get the auto version to fire ...
         setComplete();
         endTransaction();
+
+        TransactionUtil.executeInUserTransaction(this.transactionService, new TransactionUtil.TransactionWork<Object>()
+        {
+            public Object doWork() throws Exception
+            {
+                // Check that the initial version has not been created
+                VersionHistory versionHistory = VersionServiceImplTest.this.versionService.getVersionHistory(versionableNode);
+                assertNotNull(versionHistory);
+                assertEquals(1, versionHistory.getAllVersions().size());                
+                
+                // Add some content 
+                ContentWriter contentWriter = VersionServiceImplTest.this.contentService.getWriter(versionableNode, ContentModel.PROP_CONTENT, true);
+                assertNotNull(contentWriter);
+                contentWriter.putContent(UPDATED_CONTENT_1);
+                
+                return null;
+            }
+        });
+        
+        // Now lets have a look and make sure we have the correct number of entries in the version history
+        TransactionUtil.executeInUserTransaction(this.transactionService, new TransactionUtil.TransactionWork<Object>()
+        {
+            public Object doWork() throws Exception
+            {
+                VersionHistory versionHistory = VersionServiceImplTest.this.versionService.getVersionHistory(versionableNode);
+                assertNotNull(versionHistory);
+                assertEquals(2, versionHistory.getAllVersions().size());
+                
+                return null;
+            }
+        
+        });
+    }
+    
+    public void testAutoVersionOff()
+    {
+        // Create a versionable node
+        final NodeRef versionableNode = createNewVersionableNode();
+        this.dbNodeService.setProperty(versionableNode, ContentModel.PROP_AUTO_VERSION, false);
+
+        setComplete();
+        endTransaction();
+
+        // The initial version should have been created now
+        
+        TransactionUtil.executeInUserTransaction(this.transactionService, new TransactionUtil.TransactionWork<Object>()
+        {
+            public Object doWork() throws Exception
+            {
+                // Add some content 
+                ContentWriter contentWriter = VersionServiceImplTest.this.contentService.getWriter(versionableNode, ContentModel.PROP_CONTENT, true);
+                assertNotNull(contentWriter);
+                contentWriter.putContent(UPDATED_CONTENT_1);
+                
+                return null;
+            }
+        });
         
         // Now lets have a look and make sure we have the correct number of entries in the version history
         TransactionUtil.executeInUserTransaction(this.transactionService, new TransactionUtil.TransactionWork<Object>()
@@ -463,4 +516,37 @@ public class VersionServiceImplTest extends BaseVersionStoreTest
         
         });
     }
+    
+    public void testInitialVersionOff()
+    {
+        // Create node (this node has some content)
+        HashMap<QName, Serializable> props = new HashMap<QName, Serializable>();
+        props.put(ContentModel.PROP_INITIAL_VERSION, false);
+        HashMap<QName, Serializable> props2 = new HashMap<QName, Serializable>();
+        props2.put(ContentModel.PROP_NAME, "test.txt");
+        final NodeRef nodeRef = this.dbNodeService.createNode(
+                rootNodeRef, 
+                ContentModel.ASSOC_CHILDREN, 
+                QName.createQName("{test}MyVersionableNode2"),
+                TEST_TYPE_QNAME,
+                props2).getChildRef();
+        this.dbNodeService.addAspect(nodeRef, ContentModel.ASPECT_VERSIONABLE, props);
+        
+        setComplete();
+        endTransaction();
+
+        // The initial version should NOT have been created
+        
+        TransactionUtil.executeInUserTransaction(this.transactionService, new TransactionUtil.TransactionWork<Object>()
+        {
+            public Object doWork() throws Exception
+            {
+                VersionHistory versionHistory = VersionServiceImplTest.this.versionService.getVersionHistory(nodeRef);
+                assertNull(versionHistory);
+                
+                return null;
+            }
+        });
+       
+    }
 }
diff --git a/source/java/org/alfresco/repo/version/VersionableAspect.java b/source/java/org/alfresco/repo/version/VersionableAspect.java
index 670ab40330..385ff51af6 100644
--- a/source/java/org/alfresco/repo/version/VersionableAspect.java
+++ b/source/java/org/alfresco/repo/version/VersionableAspect.java
@@ -20,16 +20,13 @@ import java.io.Serializable;
 import java.util.Map;
 
 import org.alfresco.model.ContentModel;
-import org.alfresco.repo.action.evaluator.HasVersionHistoryEvaluator;
 import org.alfresco.repo.action.executer.CreateVersionActionExecuter;
 import org.alfresco.repo.policy.Behaviour;
-import org.alfresco.repo.policy.BehaviourDefinition;
 import org.alfresco.repo.policy.JavaBehaviour;
 import org.alfresco.repo.policy.PolicyComponent;
 import org.alfresco.repo.policy.PolicyScope;
 import org.alfresco.repo.rule.RuntimeRuleService;
 import org.alfresco.service.cmr.action.Action;
-import org.alfresco.service.cmr.action.ActionCondition;
 import org.alfresco.service.cmr.action.ActionService;
 import org.alfresco.service.cmr.repository.NodeRef;
 import org.alfresco.service.cmr.repository.NodeService;
@@ -136,12 +133,6 @@ public class VersionableAspect
                 QName.createQName(NamespaceService.ALFRESCO_URI, "onCopyNode"),
                 ContentModel.ASPECT_VERSIONABLE,
                 new JavaBehaviour(this, "onCopy"));
-        
-        // Register the onCreateVersion behavior for the version aspect
-        //this.policyComponent.bindClassBehaviour(
-        //        QName.createQName(NamespaceService.ALFRESCO_URI, "onCreateVersion"),
-        //        ContentModel.ASPECT_VERSIONABLE,
-        //        new JavaBehaviour(this, "onCreateVersion"));
 	}
     
     /**
@@ -200,8 +191,19 @@ public class VersionableAspect
 	{
 	    if (aspectTypeQName.equals(ContentModel.ASPECT_VERSIONABLE) == true)
         {
-	        // Queue create version action
-            queueCreateVersionAction(nodeRef);
+            boolean initialVersion = true;
+            Boolean value = (Boolean)this.nodeService.getProperty(nodeRef, ContentModel.PROP_INITIAL_VERSION);
+            if (value != null)
+            {
+                initialVersion = value.booleanValue();
+            }
+            // else this means that the default vlaue has not been set the versionable aspect we applied pre-1.2
+            
+            if (initialVersion == true)
+            {
+                // Queue create version action
+                queueCreateVersionAction(nodeRef);
+            }
         }
 	}
     
@@ -259,15 +261,13 @@ public class VersionableAspect
     {
         if (this.rule == null)
         {
+            // Create the version action rule
             this.rule = this.ruleService.createRule("inbound");
             Action action = this.actionService.createAction(CreateVersionActionExecuter.NAME);
-            ActionCondition condition = this.actionService.createActionCondition(HasVersionHistoryEvaluator.NAME);
-            condition.setInvertCondition(true);
-            // conditions are only evaluated on the parent rule - not the contained actions
-            rule.addActionCondition(condition);
             this.rule.addAction(action);
         }
         
+        // Stash the rule pending execution at the end of the transaction
         ((RuntimeRuleService)this.ruleService).addRulePendingExecution(nodeRef, nodeRef, this.rule, true);
     }    
 }