Same thing happened on AWS. Steps to reproduce:

juju bootstrap
juju deploy ubuntu
juju deploy ubuntu --to lxc:1

juju ssh 1
tail -f /var/log/juju/machine-1.log

You'll see:
(...)
2014-04-01 23:22:36 DEBUG juju.worker.logger logger.go:60 logger setup
2014-04-01 23:22:36 DEBUG juju.worker.machineenvironment 
machineenvironmentworker.go:70 write system files: true
2014-04-01 23:22:36 DEBUG juju.worker.rsyslog worker.go:76 starting rsyslog 
worker mode 1 for "machine-1" ""
2014-04-01 23:22:36 INFO juju runner.go:262 worker: start "authenticationworker"
2014-04-01 23:22:36 INFO juju.worker.machiner machiner.go:88 setting addresses 
for machine-1 to ["10.252.117.118" "fe80::2000:aff:fefc:7576"]
2014-04-01 23:22:36 DEBUG juju.worker.logger logger.go:45 reconfiguring logging 
from "<root>=DEBUG" to "<root>=WARNING;unit=DEBUG"
2014-04-01 23:22:36 WARNING juju.cmd.jujud machine.go:277 determining kvm 
support: exit status 1
no kvm containers possible
2014-04-01 23:30:48 ERROR juju runner.go:220 worker: exited "lxc-provisioner": 
permission denied
2014-04-01 23:30:51 ERROR juju runner.go:220 worker: exited "lxc-provisioner": 
permission denied

And no container is created, nor started.

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https://bugs.launchpad.net/bugs/1299588

Title:
  LXC permission denied issue with 1.17.7

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