Thanks to your help I have solved the mail issue Thilina. The problem was two-fold.
1) php-net-smtp was not installed on the server as you identified. - Perhaps this should be added to the things the installation script originally checks against?
2) In attempting to fix the problem previously before applying the net_smtp fix, I had tried to use the EmailSender.php you had posted
here. This file also caused emails not to work and the system to become very sluggish whilst waiting for responses from the smtp server.
To conclude: Installing php-net-smtp on the server with "
apt-get install php-net-smtp" and reverting to the original EmailSender.php class resolved all mail issues.
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Still curious to know why the logs are filling with this though? Although it is unrelated to the email problem.
"[30-May-2014 09:47:42 Europe/London] Failed to determine HOME directory after trying "cd: 1: can't cd to ~" (exit $"