Just an update on this post. This morning I have updated the Backup server and clients (SQL Server and WFE Servers) to 8.12, which I understand is the latest version currently available.
And the same issue occurred. I will now raise a support call as I am not sure if this is occurring due to a mis-configuration or because I am running SPF2010 SP2 on Windows Server 2012, if it is proved to be the latter, I think this should be supported by HP as Microsoft support this setup and SPF2012 SP2 was released about a year ago.