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So other emails are being sent? Like registration emails? That seams highly unlikely as that's an error happening at the PHP mailer level of things.(the e-mail function as such seems to be working as expected)
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Sounds like your email settings in System > Global Configuration > Server > Mail are not configured properly for your server.
"(the e-mail function as such seems to be working as expected)"
So other emails are being sent? Like registration emails? That seams highly unlikely as that's an error happening at the PHP mailer level of things.
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