using the OS X restore disks that came with the Macbook.
Insert the DVD, shut down the computer, start it up and immediately hold down the "C" key.
Hold it down until you see the spinning gear.
Now that you have booted from the DVD, you will start the install process. Just move far enough along until you can see the Menu bar at the top of the screen.
Choose the Utilities option and Password reset. Follow the instructions from there.
Alternatively, as you say you have never used this machine before, you could just run the Restore disks and bring the machine back to its factory state.
Obviously someone has already done some work on this machine as the behavior you describe is not that of a brand new machine
I have recently decided to take my Macbook / Leopard out of the box after receiving it more than a year ago It's set to log on automatically when I open it / turn it on. I do not remember the password and can't change the setting without it.Now what ?