AJAX update panel causing validator to work incorrectly

Hi 

I choose a file and the name appears in the text box but then I get the validation message:
'You must choose a picture...'
I read somewhere it could be an AJAX and ASP.Net version incompatibility bug.  Can anybody advise me here?? I'm using Visual Web Developer 2008 Express and My code is as follows:

<form id="form1" runat="server"><div><asp:ToolkitScriptManager ID="ToolkitScriptManager1" runat="server"></asp:ToolkitScriptManager><asp:UpdatePanel ID="UpdatePanel1" runat="server"><ContentTemplate><asp:UpdateProgress ID="UpdateProgress1" runat="server"><ProgressTemplate>
  An update is in progress...</ProgressTemplate></asp:UpdateProgress><table align="center" border="0"><tr><td><h3>Please choose a picture:</h3></td></tr><tr><td><asp:FileUpload id="FileUpload" runat="server"  validationgroup="avbl" ></asp:FileUpload><%-- <input id="FileUpload" type="file" runat="server" />--%>                  <asp:RequiredFieldValidator id="RequiredFieldValidator2" runat="server" 
             ErrorMessage="You must choose a picture before clicking Upload!" ControlToValidate="FileUpload"> </asp:RequiredFieldValidator><br /> <input id="btnUpload" type="button" value="Upload" OnServerClick="Upload" runat="server" />&nbsp;</td></tr></table></ContentTemplate></asp:UpdatePanel></div></form>