diff --git a/p2p/conn/secret_connection.go b/p2p/conn/secret_connection.go
index 0cde9d825..43f84f0bf 100644
--- a/p2p/conn/secret_connection.go
+++ b/p2p/conn/secret_connection.go
@@ -268,6 +268,7 @@ func genChallenge(loPubKey, hiPubKey *[32]byte) (challenge *[32]byte) {
 
 func signChallenge(challenge *[32]byte, locPrivKey crypto.PrivKey) (signature crypto.Signature) {
 	signature, err := locPrivKey.Sign(challenge[:])
+	// TODO(ismail): let signChallenge return an error instead
 	if err != nil {
 		panic(err)
 	}
diff --git a/rpc/lib/server/handlers_test.go b/rpc/lib/server/handlers_test.go
index d1b41ecda..5ad8c3e82 100644
--- a/rpc/lib/server/handlers_test.go
+++ b/rpc/lib/server/handlers_test.go
@@ -16,8 +16,16 @@ import (
 	rs "github.com/tendermint/tendermint/rpc/lib/server"
 	types "github.com/tendermint/tendermint/rpc/lib/types"
 	"github.com/tendermint/tmlibs/log"
+	"github.com/gorilla/websocket"
 )
 
+//////////////////////////////////////////////////////////////////////////////
+// HTTP REST API
+// TODO
+
+//////////////////////////////////////////////////////////////////////////////
+// JSON-RPC over HTTP
+
 func testMux() *http.ServeMux {
 	funcMap := map[string]*rs.RPCFunc{
 		"c": rs.NewRPCFunc(func(s string, i int) (string, error) { return "foo", nil }, "s,i"),
@@ -108,3 +116,44 @@ func TestUnknownRPCPath(t *testing.T) {
 	// Always expecting back a 404 error
 	require.Equal(t, http.StatusNotFound, res.StatusCode, "should always return 404")
 }
+
+//////////////////////////////////////////////////////////////////////////////
+// JSON-RPC over WEBSOCKETS
+
+func TestWebsocketManagerHandler(t *testing.T) {
+	s := newWSServer()
+	defer s.Close()
+
+		// check upgrader works
+			d := websocket.Dialer{}
+	c, dialResp, err := d.Dial("ws://"+s.Listener.Addr().String()+"/websocket", nil)
+	require.NoError(t, err)
+
+		if got, want := dialResp.StatusCode, http.StatusSwitchingProtocols; got != want {
+			t.Errorf("dialResp.StatusCode = %q, want %q", got, want)
+		}
+
+		// check basic functionality works
+			req, err := types.MapToRequest(amino.NewCodec(), "TestWebsocketManager", "c", map[string]interface{}{"s": "a", "i": 10})
+	require.NoError(t, err)
+	err = c.WriteJSON(req)
+	require.NoError(t, err)
+
+		var resp types.RPCResponse
+	err = c.ReadJSON(&resp)
+	require.NoError(t, err)
+	require.Nil(t, resp.Error)
+}
+
+func newWSServer() *httptest.Server {
+	funcMap := map[string]*rs.RPCFunc{
+			"c": rs.NewWSRPCFunc(func(wsCtx types.WSRPCContext, s string, i int) (string, error) { return "foo", nil }, "s,i"),
+					  	}
+	wm := rs.NewWebsocketManager(funcMap, amino.NewCodec())
+	wm.SetLogger(log.TestingLogger())
+
+		mux := http.NewServeMux()
+	mux.HandleFunc("/websocket", wm.WebsocketHandler)
+
+		return httptest.NewServer(mux)
+}
diff --git a/types/priv_validator.go b/types/priv_validator.go
index f51abcc0e..85db65a41 100644
--- a/types/priv_validator.go
+++ b/types/priv_validator.go
@@ -76,7 +76,7 @@ func (pv *MockPV) SignProposal(chainID string, proposal *Proposal) error {
 	signBytes := proposal.SignBytes(chainID)
 	sig, err := pv.privKey.Sign(signBytes)
 	if err != nil {
-		panic(err)
+		return err
 	}
 	proposal.Signature = sig
 	return nil
@@ -86,7 +86,7 @@ func (pv *MockPV) SignProposal(chainID string, proposal *Proposal) error {
 func (pv *MockPV) SignHeartbeat(chainID string, heartbeat *Heartbeat) error {
 	sig, err := pv.privKey.Sign(heartbeat.SignBytes(chainID))
 	if err != nil {
-		panic(err)
+		return err
 	}
 	heartbeat.Signature = sig
 	return nil