It looks like your system was configured to mount the cgroup hierarchy
on /var/local/cgroup which must be interfering with cgmanager and
causing the problem you are seeing.

Can you make sure you don't have any cgroup mounts done from your
/etc/fstab ?

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https://bugs.launchpad.net/bugs/1309923

Title:
  Unprivileged lxc containers fail to start

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