diff --git a/cake/console/libs/schema.php b/cake/console/libs/schema.php
index 5245a3171..5629c3ae7 100644
--- a/cake/console/libs/schema.php
+++ b/cake/console/libs/schema.php
@@ -58,18 +58,12 @@ class SchemaShell extends Shell {
  * @access public
  */
 	function startup() {
-		$name = null;
+		$name = $file = $path = $connection = null;
 		if (!empty($this->params['name'])) {
 			$name = $this->params['name'];
 			$this->params['file'] = Inflector::underscore($name);
 		}
-
-		$path = null;
-		if (!empty($this->params['path'])) {
-			$path = $this->params['path'];
-		}
-
-		$file = null;
+		$path = $this->_getPath();
 		if (empty($this->params['file'])) {
 			$this->params['file'] = 'schema.php';
 		}
@@ -78,7 +72,6 @@ class SchemaShell extends Shell {
 		}
 		$file = $this->params['file'];
 
-		$connection = null;
 		if (!empty($this->params['connection'])) {
 			$connection = $this->params['connection'];
 		}
@@ -86,6 +79,23 @@ class SchemaShell extends Shell {
 		$this->Schema =& new CakeSchema(compact('name', 'path', 'file', 'connection'));
 	}
 
+/**
+ * Get the correct path for the params. Uses path, and plugin to find the correct path.
+ * path param takes precedence over any plugins specified.
+ *
+ * @return mixed string to correct path or null.
+ **/
+	function _getPath() {
+		if (!empty($this->params['path'])) {
+			return $this->params['path'];
+		}
+		if (!empty($this->params['plugin'])) {
+			$pluginPath = $this->_pluginPath($this->params['plugin']);
+			return $pluginPath . 'config' . DS . 'schema' . DS;
+		}
+		return null;
+	}
+
 /**
  * Override main
  *
diff --git a/cake/libs/model/cake_schema.php b/cake/libs/model/cake_schema.php
index a60b7d3a6..33641c4b8 100644
--- a/cake/libs/model/cake_schema.php
+++ b/cake/libs/model/cake_schema.php
@@ -90,7 +90,11 @@ class CakeSchema extends Object {
 		}
 
 		if (empty($options['path'])) {
-			$this->path = CONFIGS . 'schema';
+			if (is_dir(CONFIGS . 'schema')) {
+				$this->path = CONFIGS . 'schema';
+			} else {
+				$this->path = CONFIGS . 'sql';
+			}
 		}
 
 		$options = array_merge(get_object_vars($this), $options);
diff --git a/cake/tests/cases/console/libs/schema.test.php b/cake/tests/cases/console/libs/schema.test.php
index c82ea2f4b..7524a4584 100644
--- a/cake/tests/cases/console/libs/schema.test.php
+++ b/cake/tests/cases/console/libs/schema.test.php
@@ -160,7 +160,7 @@ class SchemaShellTest extends CakeTestCase {
 		$this->assertEqual($this->Shell->Schema->file, 'test_schema.php');
 		$this->assertEqual($this->Shell->Schema->connection, 'default');
 		$this->assertEqual($this->Shell->Schema->path, APP . 'config' . DS . 'schema');
-		
+
 		unset($this->Shell->Schema);
 		$this->Shell->params = array(
 			'file' => 'other_file.php',
@@ -311,7 +311,7 @@ class SchemaShellTest extends CakeTestCase {
 		$this->Shell->startup();
 		$this->Shell->setReturnValue('in', 'y');
 		$this->Shell->run();
-		
+
 		$db =& ConnectionManager::getDataSource('test_suite');
 		$sources = $db->listSources();
 		$this->assertTrue(in_array('i18n', $sources));
@@ -364,5 +364,33 @@ class SchemaShellTest extends CakeTestCase {
 		$this->_fixtures['core.article']->create($this->db);
 	}
 
+/**
+ * test that the plugin param creates the correct path in the schema object.
+ *
+ * @return void
+ **/
+	function testPluginParam() {
+		App::build(array(
+			'plugins' => array(TEST_CAKE_CORE_INCLUDE_PATH . 'tests' . DS . 'test_app' . DS . 'plugins' . DS)
+		));
+		$this->Shell->params = array(
+			'plugin' => 'TestPlugin',
+			'connection' => 'test_suite'
+		);
+		$this->Shell->startup();
+		$expected = TEST_CAKE_CORE_INCLUDE_PATH . 'tests' . DS . 'test_app' . DS . 'plugins' . DS . 'test_plugin' . DS . 'config' . DS . 'schema' . DS;
+		$this->assertEqual($this->Shell->Schema->path, $expected);
+
+		unset($this->Shell->Schema);
+		$this->Shell->params = array(
+			'plugin' => 'TestPlugin',
+			'connection' => 'test_suite',
+			'path' => '/some/path'
+		);
+		$this->Shell->startup();
+		$expected = '/some/path';
+		$this->assertEqual($this->Shell->Schema->path, $expected);
+	}
+
 }
 ?>
\ No newline at end of file