Sendmail: 550 Denied due to spam list

Hi guys, I've had to switch from postfix to sendmail on our office server to accomodate Scalix. One problem is I cannot send mail via smtp. Here's an example of smtp conversation: hansdp@theluggage:~> telnet 192.168.16.2 25 Trying 192.168.16.2... Connected to 192.168.16.2. Escape character is '^]'. 220 hercules.example.com ESMTP Scalix SMTP Relay 10.0.0.175; Tue, 16 May 2006 10:15:03 +0200 (SAST) helo theluggage 250 hercules.example.com Hello [192.168.16.178], pleased to meet you mail from: 250 hansdp@example.com... Sender ok rcpt to: 550 Denied due to spam list I can send to the domains hosted on the box, but nowhere else. If try to send from localhost, it works fine, so obviously it's not allowing relay for local network. Where do I enable this? I looked through /etc/sysconfig/sendmail but there isn't an option for it. And what I see in /etc/sendmail.cf makes no sense at all :-) Thanks Hans