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If the process was run without waiting for the deadline time out it works properly, and if we waited for the time out to occur, it reaches the final activity however it fails to send emails, Please advice.
Ti investigate I made the following process: 
When the process is run it sends an email, however if actitiy1 did not complete and is allowed to timeout, the email is not sent. When looking at the Audit trail windows I found the following:
2011-09-24 17:11:59.0 | roleAnonymous | executeTool | 4_2_kl_process1_tool1 | org.joget.workflow.shark.WorkflowToolActivityHandler | ||
<ac:structured-macro ac:name="unmigrated-wiki-markup" ac:schema-version="1" ac:macro-id="916b9180-e9b6-4a65-a402-bdc3ef96c842"><ac:plain-text-body><![CDATA[ | 2011-09-24 17:11:59.0 | roleAnonymous | executeActivity | Could not execute tool [processId=kl#2#process1, version=2, activityId=tool1] | org.joget.workflow.shark.WorkflowToolA | ]]></ac:plain-text-body></ac:structured-macro> |
Clearly the tool was executed by roleAnonymous which did not have permission to send email. Please advice since this is a show stopper for me.,