Thanks till and falko,
I looked at /etc/hostname and i saw it was listed with server1.example.com. I left that and then went to ISPConfig under management > server > settings and did the following
Hostname server 1
Everything seems to work OK .
I don`t know if this is right but it works.
Thanks Falko, I had already done this before I read your post.
If I get any more problems I shall use your suggestion.