[Dovecot] Dovecot: pipe() failed: Too many open files

[Fasil]

Dear all,

Thank you all for such a wonderful support. Hats off to all :)

Few times I came across imap login issues where new users will not be 
allowed to login.
/var/log/mail.err shows the error below
Aug 12 07:57:46 mail dovecot: dovecot: pipe() failed: Too many open files
Aug 12 07:57:46 mail dovecot: dovecot: Temporary failure in creating 
login processes, slowing down for now
Aug 12 07:58:46 mail dovecot: dovecot: pipe() failed: Too many open files
Aug 12 07:59:46 mail dovecot: dovecot: pipe() failed: Too many open files
Aug 12 08:00:46 mail dovecot: dovecot: pipe() failed: Too many open files

I have a dovecot (V 1.2.9) +postfix (V 2.7.0) setup on ubuntu 10.04

# ulimit -Hn
1024

# ulimit -Sn
1024

# cat /proc/sys/fs/file-max
1238548

# cat /proc/`pidof dovecot`/limits | grep 'Max open'
Max open files            1024                 1024 files

Please advice how to get rid off this.

Fasil.