Parsing juxtaposition-based, indentation-aware syntax using Text.Parsec.Layout - parsing

Question

I'm trying to parse a small language with Haskell-like syntax, using parsec-layout. The two key features that don't seem to interact too well with each other are:
Function application syntax is juxtaposition, i.e. if F and E are terms, F E is the syntax for F applied to E.
Indentation can be used to denote nesting, i.e. the following two are equivalent:
X = case Y of
A -> V
B -> W
X = case Y of A -> V; B -> W
I haven't managed to figure out a combination of skipping and keeping whitespace that would allow me to parse a list of such definitions. Here's my simplified code:
import Text.Parsec hiding (space, runP)
import Text.Parsec.Layout
import Control.Monad (void)
type Parser = Parsec String LayoutEnv
data Term = Var String
| App Term Term
| Case Term [(String, Term)]
deriving Show
name :: Parser String
name = spaced $ (:) <$> upper <*> many alphaNum
kw :: String -> Parser ()
kw = void . spaced . string
reserved :: String -> Parser ()
reserved s = try $ spaced $ string s >> notFollowedBy alphaNum
term :: Parser Term
term = foldl1 App <$> part `sepBy1` space
where
part = choice [ caseBlock
, Var <$> name
]
caseBlock = Case <$> (reserved "case" *> term <* reserved "of") <*> laidout alt
alt = (,) <$> (name <* kw "->") <*> term
binding :: Parser (String, Term)
binding = (,) <$> (name <* kw "=") <*> term
-- https://github.com/luqui/parsec-layout/issues/1
trim :: String -> String
trim = reverse . dropWhile (== '\n') . reverse
runP :: Parser a -> String -> Either ParseError a
runP p = runParser (p <* eof) defaultLayoutEnv "" . trim
If I try to run it on input like
s = unlines [ "A = case B of"
, " X -> Y Z"
, "C = D"
]
via runP (laidout binding) s, it fails on the application Y Z:
(line 2, column 10):
expecting space or semi-colon
However, if I change the definition of term to
term = foldl1 App <$> many1 part
then it doesn't stop parsing the term at the start of the (unindented!) third line, leading to
(line 3, column 4):
expecting semi-colon

Answer 1

I think the problem has to do with that name already eliminates the following space, so the sepBy1 in the definition of term doesn't see it.
Consider these simplified versions of term:
term0 = foldl1 App <$> (Var <$> name) `sepBy1` space
term1 = foldl1 App <$> (Var <$> name') `sepBy1` space
name' = (:) <$> upper <*> many alphaNum
term3 = foldl1 App <$> many (Var <$> name)
Then:
runP term0 "A B C" -- fails
runP term1 "A B C" -- succeeds
runP term3 "A B C" -- succeeds
I think part of the solution is to define
part = [ caseBlock, Var <$> name' ]
where name' is as above. However, there are still some issues.