The time step needs to be small enough so that contacts are within the pinball radius during a substep. Otherwise it can go from far outside contact pinball above to far outside pinball below in one time step and is never within the pinball radius to detect contact. You can increase the contact pinball, but usually you need to make time stepping low enough. There is a contact setting "predict for impact" to help with this, and you can set time stepping in the analysis settings. Also, be aware that transient usually needs some damping, either global or local. If contacts impact, they can rebound with even more energy due to the contact stiffness behavior and then the next near-contact detection can be moving faster and fly through. This behavior is noticable when viewing the time history. Lowering contact stiffness can recduce that behavior but the analysis really needs damping to prevent it.