Hi,
I think if you follow the instructions as given in the example you will not have any problems.
here are the instructions below
"This example code demonstrates one technique of handling test failures.
If this step fails, a dialog will be displayed giving options to Break, Terminate, or Retry.
The On Fail Post Action calls the HandleTestFailure sequence which is
another sequence in this sequence file.
The sequence file has the SequenceFilePreStep Callback overridden where
the initial statue of Runstate.SequenceFailed is stored in a local variable. Create a local variable in your sequence called SequenceAlreadyFailed which is a boolen.
To use this in your sequence file:
1. Copy the HandleTestFailure sequence to your sequence file.
2. For a step to use this, you
must set the On Fail Post Action to call the
HandleTestFailure sequence.
3. Override the PreStepCallback.
4. Copy the step from this example's PreStepCallback to yours.
5. Copy the TestFailureDialog.* files to the same directory as your sequence file.