Index: defaultfilters.py
===================================================================
--- defaultfilters.py	(revision 3337)
+++ defaultfilters.py	(working copy)
@@ -84,7 +84,8 @@
 
 def title(value):
     "Converts a string into titlecase"
-    return re.sub("([a-z])'([A-Z])", lambda m: m.group(0).lower(), value.title())
+    #~ return re.sub("(?u)([a-z])'([A-Z])", lambda m: m.group(0).lower(), value.title())
+    return value.decode('utf8').title().encode('utf8')
 
 def truncatewords(value, arg):
     """