Label tool does not label features when selection is overlapping existing annotation of another Layer

Description

Any feature that is labled using the label tool near the annotation of an existing layer will not be labled but rather a Map tip box will appear.

Cause

Annotation stored in the Map Document is conflicting with the label tool.

Solution or Workaround

1. Right click on the Data frame.
2. Select Properities.
3. Switch to the Annotation tab.
4. Uncheck the annotation.
5. Click Apply and OK.
6. Label the features.
7. Turn the annotation back on.
   
   

   Note:
   As an alternative you can store the annotation in as a Geodatabase Annotation Feature Class. Turn off the Annotation Layer while you are labeling other features.