You got the error message because the hard disk already contained four primary partitions. as we know, HP or DELL windows 7 laptop usually contain hide partition and recovery partition, HP Tool partition, system reserved partition and HP recovery partition (All of them are primary partitions). so you can not create new partition unless converting basic disk to dynamic disk.
Solutions:
1. If you are not running Windows 7 Home, you could choose convert basic disk to dynamic disk.(Only Windows 7 Home can not support dynamic disk)
2. Delete one primary partition; create logical partition by using some 3rd party tools:
http://www.extend-partition.com/reso...-windows7.html
Of course, Windows 7 Disk Management could automatically create logical partition when there are three primary partitions.
3. Convert several primary partitions to logical partitions, after that, you could create partition without any limitation.
Hope these are helpful for solving your problem. (: