You can override create method like:

class Contacts(models.Model):
    _inherit = 'res.partner'

    @api.model
    def create(self, vals_list):
        email = vals_list.get('email', None)
        if email:
            partner = self.env['res.partner'].search([('email', '=', email)], limit=1)
            if partner:
                raise ValidationError('User already exists.')
        return super(Contacts, self).create(vals_list)