UIMA AS documentation states that continue on failure action is not allowed when specifying error handling for colocated delegate. This restriction was motivated by the fact that when a CAS processing fails in a colocated delegate, that CAS integrity may be compromised and such CAS should not be used for analysis by downstream annotators. Although this may be true, what to do with the CAS should be left up to the user's FC. The UIMA AS code actually supports continue on error for colocated delegates and the documentation should change to say that it is a valid choice.
Also, DDE GUI should change to enable continue on error as a valid choice.