problem install lockwood 001

HI, I'm replacing the old not very secure lockwood on the front door with a 001 deadlatch

l001.jpg

It's been about 20 years since I last installed one and this time I cannot get it working from the outside once closed - the key won't turn once the deadlatch is pushed in. Yet I thought that is exactly how they are meant to work, hence having a 3mm gap or less between the door and the jamb. Nothing is jamming the mechanism as far as I can tell, as everything turns beautifully without the deadlatch depressed

Any ideas what can be causing this?

thanks. Greg
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