thanks for the reply. I've got 12gb of RAM so it shouldnt really be that. The mac is my work computer and my collegue has the identical set up (both Macs were bought and configured about 3 weeks ago) and his works fine.
Since Mail is installed with the operating system, you might do the full update (not incremental) to Mac OS X 10.7.3. You can get that at the Apple website. Sometimes, incremental updates cause problems and downloading the full update fixes them.