Bypass Permissions mode fails to apply on session start, falls back to Accept Edits

Preflight Checklist

• [x] I have searched existing issues and this hasn't been reported yet
• [x] This is a single bug report (please file separate reports for different bugs)
• [x] I am using the latest version of Claude Code

What's Wrong?

Setup:

Settings → Claude Code → "Allow bypass permissions mode" is enabled
~/.claude/settings.json contains {"permissions": {"defaultMode": "bypassPermissions"}}
Fully quit (Cmd+Q) and reopened the app

Expected: New sessions start in Bypass Permissions mode and stay there.
Actual: New session shows "Bypass permissions" in the mode pill at session start. On the first tool use, a yellow banner appears: "Bypass Permissions mode isn't enabled. The session started in Accept Edits — enable Bypass Permissions in Settings to use it." A second banner appears: "Permission mode couldn't be changed. You can try again." The session falls back to Accept Edits regardless of what's selected.
Reproducible: Yes, every new session in this project.

What Should Happen?

Setup:

Settings → Claude Code → "Allow bypass permissions mode" is enabled
~/.claude/settings.json contains {"permissions": {"defaultMode": "bypassPermissions"}}
Fully quit (Cmd+Q) and reopened the app

Expected: New sessions start in Bypass Permissions mode and stay there.
Actual: New session shows "Bypass permissions" in the mode pill at session start. On the first tool use, a yellow banner appears: "Bypass Permissions mode isn't enabled. The session started in Accept Edits — enable Bypass Permissions in Settings to use it." A second banner appears: "Permission mode couldn't be changed. You can try again." The session falls back to Accept Edits regardless of what's selected.
Reproducible: Yes, every new session in this project.

Error Messages/Logs

Bypass Permissions mode isn't enabled. The session started in Accept Edits — enable Bypass Permissions in Settings to use it.

Steps to Reproduce

Setup:

Settings → Claude Code → "Allow bypass permissions mode" is enabled
~/.claude/settings.json contains {"permissions": {"defaultMode": "bypassPermissions"}}
Fully quit (Cmd+Q) and reopened the app

Expected: New sessions start in Bypass Permissions mode and stay there.
Actual: New session shows "Bypass permissions" in the mode pill at session start. On the first tool use, a yellow banner appears: "Bypass Permissions mode isn't enabled. The session started in Accept Edits — enable Bypass Permissions in Settings to use it." A second banner appears: "Permission mode couldn't be changed. You can try again." The session falls back to Accept Edits regardless of what's selected.
Reproducible: Yes, every new session in this project.

Claude Model

Opus

Is this a regression?

Yes, this worked in a previous version

Last Working Version

_No response_

Claude Code Version

1.9255.0

Platform

Anthropic API

Operating System

macOS

Terminal/Shell

Terminal.app (macOS)

Additional Information

_No response_