As discussed on the mailing list (subject: funcarg name clash / conftest load behaviour) it would be nice if py.test does not implicitely load the sibling directory's conftest.py in case those directories are not packaged with an init.py.
Consider the directory structure:
ROOTDIR/ a/ conftest.py test_hello.py b/ conftest.py test_hello.py
Calling py.test from ROOTDIR with argument 'a' (or from ROOTDIR/a without args) should not load b/conftest.py.
The applied patch against py-1.3.1 adds a test case for this situation. I have to say that I'm not sure whether the location is best and things in it might be done better, because this was the fist time I'm in touch with the code.
Best regards, Frank