When using a Windows Phone 7 device to connect to Exchange Server 2003 using Exchange ActiveSync, you are unable to resolve user names within your Global Address List (GAL).
When creating a new e-mail message, you type the name or alias of an e-mail recipient in your organization's GAL in the TO field and the name is not resolved. In addition, you are unable to Search the GAL, and can only search local Contacts.
Install the latest updates for your Windows Phone 7 device. For information on updating your Windows Phone 7 device, see the following topic:
How do I update my phone software?
Prior to the update, the workaround was to address recipients with a complete e-mail address such as email@example.com.
For additional information on Windows Phone 7 updates, see the following topics:
Windows Phone 7 Updates
Windows Phone 7 Updates History