Created attachment 77077 [details]
Circle shows empty gap.

Problem description: 
When scaling down picture, Writer leaves empty gap under picture.

Steps to reproduce:
1. Type some text, at least two paragraphs
2. Insert fairly large picture in first one
3. Set anchor "As character" (it really doesn't matter)
4. Try to Shift-click and scale it down (it does the same thing even when I set picture options Width and Height manually in Picture dialog)

Current behavior:
When I do steps above, it leaves empty gap between bottom of picture and following text below picture.
I can remove it by clicking right side of picture, and then pressing "Delete" and then "Enter", but I don't think it should work like that.

Expected behavior:
When I scale down image, it should automatically fit all contents to it's place.

Note:
I'm using XUbuntu 12.10 and I experienced same thing on Crunchbang Waldorf. I don't know latest-known working version.
Operating System: Linux (Other)
Version: 4.0.2.1 rc