Sign In
  • Question

    What happens for now? There is no further information on the owner and no one to contact. Is this termination for default (due to death)? or what? In my 31 years I have never experienced a contractor's death with contract in place. Please advise.


    1. The references quoted below in pertinent part are applicable to this response.

    Gilbert A. Cumo* and Eldon H. Crowell; found at the following web link:

    American Law Institute's Restatement of Contracts synthesizes a detailed set of rules keyed to the phrase "impossibility of performance”. … Restatement § 459: Death or illness of the promisor, where his particular performance was bargained for, will excuse performance.

    B. A sole proprietorship is a type of business entity that is owned and run by one natural person and in which there is no legal distinction between the owner and the business. The owner is in direct control of all elements and is legally accountable for the finances of such business and this may include debts, loans, loss etc.

    2. Our response assumes that this inquiry is asking whether the contract in question should be terminated for “default” or for “convenience”. Because the contractor in this case is apparently a Sole Proprietorship, then pursuant to the common law of contracts as described in reference 1A above, the contractor’s death may excuse the contractor’s continued performance under the contract due to “impossibility of performance”. As such, we believe that any contract termination proceedings also would be with the contractor’s estate.

    3. Therefore, the Contracting Officer should consult agency legal counsel to determine which type of termination is most appropriate under these circumstances given the common law of contracts as applied to this situation. Because there is “no further information on the owner and no one to contact”, agency counsel should also be consulted as to the procedures that should be followed to resolve this situation (e.g., whether the Justice Department must become involved at this time).

    Open full Question Details