I'm pretty sure it's because the theme isn't compatible with the latest version of SMF.
Soon as we figure out _which_ theme it is I can try and fiddle with it on my copy of SMF 1.1.3 - both versions of Pagen I found on SMF's theme site are for old versions of SMF:
http://custom.simplemachines.org/themes/index.php?lemma=72 - 1.1.1, current version of SMF is 1.1.3
http://custom.simplemachines.org/themes/index.php?lemma=159 - 1.1 RC3, current version is 1.1.3.
To be honest though I've never seen a theme outright blow up like that, so this could be fun to try and fix
Edit: I should clarify, I'm only guessing that the theme in question is one of those two - if you got the theme from somewhere else, I have no idea what theme it is >_<
Edit 2: FYI for anyone doing testing on this, the error comes up whenever you go into a board to view messages. Strange since I'dve thought it'd blow up where all the other themes I use do - right on the board list... Definitely a thinker.
Edit 3: K, I found a really crappy way to fix the theme, but it probably makes it look different than pagan was originally intended to look.
1) In pagan's theme directory (/Themes/pagan), rename MessageIndex.template.php to something else (I named it MessageIndex.template.php.orig so I'd know which was the original and which was the one from the next step).
2) If you didn't delete the classic theme, then go under "/Themes/classic/" and copy the MessageIndex.template.php found there into the "/Themes/pagan/" directory.
That'll fix the error, but like I said, its probably taking away something pagan did to make it look better. Whats confusing the heck out of me is why pagan modified the messageindex.template.php so much; SMF's classic theme has 338 lines in MessageIndex.template.php, while Pagan has 471. Guess what? Line 214 is right smack in the middle of where the two start to change (line 145 in the classic theme, line 198 in Pagan).
In any case, theres a comment in the SMF Theme forum for Pagan citing the exact same error. The advice was to re-upload the theme; personally I don't think that'll fix it since I've just re-uploaded it for the third time this evening (third download as well, once to a public server, once to private, and once to localhost). It's worth a shot, but as far as I can tell, the last update he put in for Pagan completely screwed something up. Sorry