One thing is absolutely for sure, and that is the foliage on your tree is not getting water. We know this because the leaves have remained on the tree as they dried. There is only three possible reasons for this condition.
1). As jrb wrote, the water is taking the path of least Resistance and simply running down the sides through the porous CHC.
2). The water is only channeling through the original potting soil..
3). The roots a either rotted or dead.
Even with what jk840 wrote, I believe it is reason #1.
However, it is very easy to find out what the problem is, by slipping the tree from the container and examining the root system. Doing so, you will immediately find out the answer. - Millet-799