This has now been resolved. The problem was that rules had been set up somehow that diverted mail to the contacts folder. To correct go to Outlook Tools and select Rule Wizard. Rules diverting email can then be deleted.
My incoming mail arrives into the contacts folder! This is only a recent problem and I haven't changed any settings knowingly. Anyone know how I can correct this?

Chowhound
Comic Vine
GameFAQs
GameSpot
Giant Bomb
TechRepublic