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Rifter 23 pg 20

can be severed at any time by mutual consent of both the Spell Breather and the Living magic,
so if they do not both agree the bond cannot be severed,
save by a Steal Living Magic spell

If not for that last part, I wouldn't thought the middle part was just explaining how the first part worked: severing via mutual consent.
That perhaps other standard means for ending magical effects (ie Anti-Magic Cloud, Negate Magic) would work.

But on seeing the 3rd line I figured my initial assumption wrong:
if that were the case you wouldn't need a disclaimer for Steal Living Magic, nor would you need that "save by" statement, which implies this is the ONLY other option (maximum 2 options) for severing.

This makes me wonder how it works in cases of the death of the caster... death isn't automatic consent, right? So would this mean that a Living Magic still remains bonded to a Spell Breather even after the caster dies?

If it's possible to communicate in spirits then perhaps you could use some spell to contact the ghost of the Spell Breather and RP to convince them to consent to release the Living Magic (and you'd need to convince the spell too!) to adopt it, as otherwise you'd need to use the riskier "Steal" instead of "Bond".

Both cost the same PPE (including 1 PPE permanently!) but Bond is more reliable since there's only a single savings throw (by the Living Magic) instead of two for Steal (by both the LM and the S-Breather it's bonded to). Presumably even in death, the spirit of a dead Spell Breather still gets a save vs magic to maintain the bond another Breather is trying to steal?

Getting such consent is probably hard though: after all a Spell Breather sacrifice 1 PPE permanently to make that bond... if they ever got resurrected then they might still enjoy the benefit of that bond, so they might not want to lose it.

Maybe a Living Magic is the only companion the spirit of a dead Spell Breather would have? Maybe they could even cast Summon Living Magic in the afterlife to draw the Living Magic to accompany them in whatever afterlife dimension they're living in?

Part of what's confusing about this is we don't have any kind of universal clearcut rules on life-after-death for people. We have some vague indications in books like Dragons and Gods / Pantheons of the Megaverse where it talks about souls moving on and living in deific realms .. but what about those who don't worship a god? We don't even know what mechanic is used to transport spirits aside from knowing that Utu can mess with the flow of any who die on the Palladium World.

This makes me wonder what would be a good baseline here for treating life after death and in contacting decreased Spell Wranglers to discuss them revoking their bonds, or if they don't revoke them, in those maintained-in-death bonds being used to draw Living Spells to an afterlife dimension?

Hey, the writer of these spells, Ed3 is my gm and I ran your question by him. Here's the answer:

I wrote these rules a few years back and as with everything, you try to cover all the scenarios you can imagine as clearly and completely as you can. A spell breather’s connection to their magic is meant to be functionally permanent, so negate magic and other spell breaking spells and powers have no effect on the link (though some of these things can kill a living magic).

Death of either party would create an interruption in the bond leaving the possibility that either could find a replacement for their missing partner. Exactly how this plays out would depend on the GM and the cosmology of their campaign. If the question came up in my game I’d handle it like this;

Death creates an interruption in the bond. When the Spell breather is killed all his living magics are theoretically free. If the spell breather is resurrected the bond will reassert itself and the living magics will again serve that spell breather.

If another spell breather comes along and bonds a free living magic of a dead spell breather, that living magic will be his, and the new bond will replace the old, even if the old spell breather is resurrected. The old spell breather may try to steal back the living magics lost this way, or I suppose he might murder their new master.