I couldnt find a solution to this issue anywhere else so just thought I would ask here.
Whenever the <form> tag has encoding="multipart..." for uploading files, somehow PHP wont fill the global variables, ie no form variables are declared. I have had this issue on two of my client servers and fixed it temporarily by disabling file uploads for attachments by removing the encoding part.
If anyone knows what could be causing this problem then please let me know. I would appreciate it. Thanks