Thanks. It does not not close properly, closing hides it but does not return control to the calling form. I'll try to come up with a full example demonstrating the problem.
I've created a project with 2 forms.
Added "Show modal" on form1, where there method calls Form2.ShowModal;
Added a "special close" button on Form2 that is calling Close() method
Launching the app.
- click show Modal - form2 shows up as expected
- click "special close" - the focus returns to form1
- click show Modal again - form 2 shows up as expected
- clock on X icon (close) the focus returns to form2 as expected
Sidenote: I'm using trunk