This article is from the PGP FAQ, by Jeff Licquia firstname.lastname@example.org with numerous contributions by others.
You are probably using MIT PGP, or possibly some other version of PGP
with the "legal_kludge" option turned off.
As part of the agreement made to settle PGP's patent problems, MIT PGP
changed its format slightly to prevent PGP 2.4 and older versions
from decrypting its messages. This format change was written into MIT
PGP to happen on September 1, 1994. Thus, all messages encrypted with
MIT PGP after that date are unreadable by 2.4 (and earlier).
The best route here is for your friend to upgrade to a newer version
of PGP. Alternatively, if you are using a non-MIT version, look up
the "legal_kludge" option in your documentation; you should be able to
configure your copy of PGP to generate old-style messages.