Answered
Look at your Preferences>Interface tab, what had you got selected for the Panel Tracks setting? If it's set to "Manual" then what you are seeing is expected behaviour, i.e. the side panel will remain visible no matter what view mode (Grid or Detail) that you have selected. To hide the side panel requires you to do that manually, e.g. by clicking on the currently selected tool on the tool bar.
However, if you change the setting to "Automatic", you should get the behaviour you are looking for.
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