Indeed this sounds like one of you has blocked the other - probably by mistake.
As Ferrin suggested go into your Friendlist (in game), click on the Blocked Users section and make sure your friend's name isn't on there - if it is just remove it from the block list c;
If that doesn't work be sure to check in here again, and we'll see if we can help you further.
Good luck~ // Shallow
Sometimes the server gets buggy. Like one time I was talking to a friend for a while and then the Whisper was broken for me and my friend. But i guess its a different matter.
But like said above, it does sound like you two blocked each other by mistake. Just unblock each other and everything should go back to normal