Somewhere in your files is a contract with a client who trusts you personally. You signed it in a good week, with a good feeling. Your name is on it. It never occurred to either of you to ask what the paper says on the day you stop being able to perform it.

That day has a legal answer. Most founders find it out secondhand, through the person they love most, in the worst month of that person's life.

The contract was built around you, not your company

A lot of solo founders and consultants think their clients have contracts with "the business." If you run a sole proprietorship, or a single-member LLC that you haven't kept carefully separate, the business and you are practically the same party. Even where the LLC is the named party, the client usually chose the LLC because of the person behind it.

Contract law has a long-standing idea for this situation. When a contract calls for personal performance, meaning your skill, your judgment, your hands, the death or incapacity of that person generally discharges the duty to perform. The Restatement (Second) of Contracts addresses this directly in § 262. It's a common-law default, and the details vary by state and by contract wording. Still, the pattern is consistent. If the agreement depends on you specifically, it usually doesn't pass to your executor as a job to finish.

That sounds almost merciful. Nobody can sue your grieving family for failing to deliver a design system you were building. But the discharge is only one half of the picture, and the other half is where families get hurt.

What ends, and what quietly keeps going

Think of a client agreement as a bundle of separate promises. They don't all expire together.

The duty to perform may end, as above, if the work was personal.

The money may reverse. If a client prepaid a retainer or a deposit for work you hadn't done, that money isn't yours anymore in any meaningful sense. It's a claim against your estate. Your executor may owe a refund to a client they have never heard of, from a bank account they can't yet access. Money for work already done, by contrast, is an asset the estate can collect, which is a separate problem about who even knows it's owed.

Confidentiality survives. Most NDAs and confidentiality clauses run for a defined term after the relationship ends, and some run indefinitely. Your laptop, your cloud drive, and your email are full of client information. Your family now holds the devices. They may not know that opening, forwarding, or casually deleting certain things carries a duty.

Data-protection duties survive too. If you handle client customer data, you're a custodian in the eyes of many contracts and some laws. That obligation doesn't dissolve because the custodian died. Someone has to return or destroy the data on the contract's terms.

Intellectual property terms matter more now. Whether the client owns the work product on payment, or only receives a license, determines what your estate can do with it, and what the client can demand. Half-finished work with unclear ownership is a standoff waiting to happen.

Indemnities and warranties can outlive you. If you promised to stand behind your work, a claim arising from past work can be made against your estate. That's a reason to think about tail coverage, but it's also a reason to read what you actually promised.

The assignment clause nobody reads

Here is the sentence that decides a surprising amount: "Neither party may assign this agreement without the other's written consent."

It's boilerplate, and it's in nearly every contract. It means your executor generally can't hand your client relationship to a trusted colleague, or sell the book of business, without each client agreeing. Some contracts add that the agreement terminates automatically on the death or incapacity of the contractor. Others say nothing at all, and the default rules apply.

This matters because the value of a small service business is often its recurring relationships. If the contracts can't move, and the clients are free to leave, the business your family inherits may be worth a fraction of what you imagined. That's one reason valuing a small business for estate purposes is so slippery. A lot of that value is goodwill attached to a person, and the person is gone.

It cuts the other way as well. A clause that lets the client walk the moment you die is a clause that lets you make a plan. You can't control the law, but you can write the contracts.

Why this goes wrong in real life

The mechanism isn't legal ignorance. It's the gap between the contract exists and anyone can find it.

Your executor doesn't know which clients have prepaid, which have deadlines, or which have confidentiality terms stricter than usual. They find out client by client, as emails arrive. Each one is a small emergency: Where's the file you promised us? Are we still on for Thursday? Meanwhile, every day that passes without a note to the client makes the silence look like abandonment, and the client's goodwill, the only thing worth transferring, drains away.

Psychologists describe a related effect called ambiguity aversion: people strongly prefer known risks over unknown ones, and they respond to uncertainty by freezing or backing out. A client who gets a clear, kind, specific message in the first week stays calm. A client who gets nothing starts shopping for a replacement. The message is the asset.

Your next moves

  • List every active client agreement in one place. For each, record the client, the start and end dates, the fee structure, and where the signed copy lives. An hour with your invoicing tool and inbox will get you most of it.
  • Mark the ones with money held. Flag any prepaid retainer or deposit you haven't fully earned, and note the amount. This is the number your executor would owe back.
  • Read three clauses in your top five contracts: assignment, termination, and confidentiality. Write one line per contract in plain English: "Can't be assigned," "Ends on my death," "NDA runs three years."
  • Add a succession sentence to your next contracts and renewals. For example: the client may continue with a named substitute, or the agreement ends cleanly and the unearned balance is refunded within 30 days. Have a lawyer check wording for your state.
  • Draft a template note to clients. Four sentences your executor can send: what happened, who the contact is, what happens to current work, and what happens to their files. Store it where the executor will find it.
  • Name a handoff peer. Ask one trusted colleague whether they'd take on referrals or finish urgent work. Write their name next to the clients they'd be best for.

The kindest clause is the one you wrote in advance

None of this is morbid. It's the same professionalism that leads you to scope a project and write a clear statement of work. You wouldn't start a client engagement without defining what "done" looks like. Your own absence deserves the same clarity.

This is the kind of scattered, sensitive information Heirloom was built to hold in one place: client agreements, who owes what, the notes your executor will need, and the people who should receive them, all kept in a binder your family can open when you can't. If you'd like a place to start, you can see how it works at https://heirloom.lumenlabs.works. But the real work is the list, and you can begin it this afternoon with a pen.