We discovered an issue with jsonview plugin which some of our customers have running in the background of their browser.
Such an issue will not allow you to upload any file into LiveAgent (into ticket, chat or avatar change). You'll get just an error message like "Upload error with message:" during a file upload.
Please check your browser section related to plugins and turn OFF jsonview plugin and if possible, turn off any of running plugins - then try to upload the file once again.