There is very little information in your question, like how did you install sendmail (from source, or as binaries). Also, have you had experience with sendmail before? It's notorious for it's configuration files. :)
My quick research show that sendmail from version 8.9 on, by default do not set open relay. There is however a newer version available from www.sendmail.org namely 8.11.4. (You might want to upgrade, if this is the first time you are installing sendmail.) You will most probably need the sources, since you will need to edit the m4 configuration files, then recompile them. I have no direct experience with sendmail on Solaris 2.7, but I did have to modify the configuration on my Linux box.
Let me know the circumstances leading up to you discovering the hole, and we can take it from there. Feel free to email me.
Kind Regards,
Andries J Burger