The client learns info by requesting the size of a file before uploading. It confirms it doesn't exist if it gets an error (which is why you see an error if you are uploading but not racing), or it gets its current size which it will use for resuming the transfer or deciding it's complete.
In flash you can actually turn this behavior off by disabling the Request file size/date prior to transfer option under file transfer rules. This is a good thing most of the time, the only reason you might want to turn it off is if the site supports x-dupe.
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