I had the same problem -- when using the shower, water would leak into
the wall. The spout was designed to go over the copper pipe stub and
seal with an O-ring and was held in place with a setscrew.
Unfortunately, the setscrew bent the pipe stub out of round making a
good seal impossible. Adding insult to injury, the previous owner
smeared lots of caulk in an unsuccessful attempt to stop the leak. The
ultimate solution was to scrape away the caulk and solder on a pipe
extension with a threaded fitting to a new spout assembly. Fortunately
I got the pipe length right the first time. The leftover caulking was
enough to generate lots of smoke and trigger the fire alarm during
soldering. But once it was complete and all the soot cleaned up, I
never had a leaking problem again.