It appears that email is already in the database on another row. This can have many causes; importing users twice, creating accounts in a custom module without proper checking if the email address is available, etc.
If you do not use the account edit forms, but modify users programmatically, it can appear that the same email is added to the database twice (the form validation does not run in those cases). Then later when you try to edit one such user, it cannot save because that account should not have existed in the first place. This measure is there so users cannot sign up with the same email twice, but since the user creation and edit form are in fact the same form (and as such have the same validation), it can happen during the save of a user as well.
Double check that you have no modules that can create accounts from email addresses (eg. Drupal commerce) and check your database
users table to identify the duplicate account.