Something somewhere is converting an apostrophe into the HTML equivalent (http://en.wikipedia.org/wiki/Apostrophe#Unicode). I saw this a long time back with one of my users and accented characters, but I can’t remember which component was the culprit, but it was fixed on my end.

To rule out your side of the email transaction, ensure that everything in your stack, for example browser, php, apache, mail transfer agent (sendmail/postfix), mail server (dovecot/courier/cyrus/qmail) and any other filters that operate on the mail content (anti-virus,spam-filter) all handle UTF (unicode) correctly, in my case that meant standardising on UTF8 throughout my stack. Even when you have done all that, you may find it is something out of your hands, like the webmail service that your customer/user recipient is using.

That’s a really broad answer, but I hope it helps a little.