Hello,
please make sure that your Exchange SMTP virtual server is correctly configured. This error can occur if your SMTP virtual server does not have a valid fully qualified domain name or it the DNS lookup of the SMTP virtual server failed.
Also verify that "domain.local" is configured for inbound email as explained in this Microsoft knowledgebase article:
http://support.microsoft.com/kb/260973. If you are using a multiple domain names, make sure the additional domains are configured as described in this article:
http://www.petri.co.il/configure_exchange_2000_2003_to_receive_email_for_other_domains.htm.
Regards,
Eclarsys Support