I repeated the same procedure i.e. rebooted and waited approx 30 mins
before login to ubuntuone but this time there was no problem. The only
difference I can think of is sbackup does an automated incremental
backup soon after ubuntu is booted and this would have been before the
login to ubuntuone the first time but there would be no incremental
backup the second time as this is a daily routine. As an experienced
user this is the only thing I can think of if it helps. As regards this
'bug' i have not been able to replicate the error thus far.

-- 
UbuntuOne reported fatal error on booting up.
https://bugs.launchpad.net/bugs/528379
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