I had this problem because I deleted a conflicted folder out of the repository by using the repo browser.
(It was not possible to delete the folder from my working copy and commit the change).

Now I wanted to add the repaired folder to my working copy which cause the error above.

There are there options to solve this problem:

1. If the folder is a subfolder you can delete the parent folder and make a svn update on everything.
2. If the folder is in the first level you can checkout the whole project again.
3. My solution, which worked very well, was to checkout the whole project to a temp dir, then I copied the first level .svn directory and replaced my working copy .svn folder with this.