Where: Playing the Warmage class.
When: Whenever, wherever.
What: If one equips warmage spellslot items and then takes them off, it simply removes a spell slot from the warmage. Crucially, regardless of whether one rested with them equipped or not, this always occurs, and repeatedly. So what can end up happening is that if you did not rest with the spell slot items to gain extra spell slots, then wear them and take them off (for instance, the Staff of the Apprentice Warmage, which you often can end up switching in and out of wielding if you have to engage NPCs in dialogue), you will simply end up with two fewer 1st circle spell slots and one fewer 2nd circle one. This will occur until you have none left at all.
Recreate: Pick warmage class, get to a level sufficient enough to benefit from spell slot items, wear them and take them off repeatedly and watch your spell slots dwindle down to zero.
Ideas: No clue.