The error message is likely because you have an old version of iPhoto installed, from your previous version of OS X. It may be too old and does not support Yosemite (the latest version, iPhoto 9.6.1, should still run).
iPhoto is no longer supported and has been replaced by the new Photos app as of OS X 10.10.3. Correspondingly, the iPhoto app is longer available on the Mac App Store (along with Aperture).
If you are on OS X 10.10.3 or newer, opening the new Photos app will migrate your iPhoto library, along with all included photos, albums/events, and metadata. You can then delete the iPhoto app from your Applications folder, move it to an external hard drive if you want to keep it for whatever reason, or just leave it there if you do not have disk space concerns.
It may be ideal to make a backup/copy of the
iPhoto Library.photolibrary file in your users'
Pictures folder onto an external hard drive or USB flash drive before using the Photos app to migrate your library. This will ensure you have a way to fix things if there are problems.