Roger Wilson, the suspended director of planning, development and amenities at Bedford, died of a heart attack.
He was due to testify against former leader Mike Cotter and suspended economic development officer Nicholas O'Reagan.
The accused are each defending three charges of corruption and one charge of conspiracy brought by the Crown Prosecution Service.
Police began investigating corruption and conspiracy at Bedford in November 1995 and finished their enquiries in April last year.
The council did not investigate the charges against Mr Wilson, as police told it to wait until after the criminal case. In the meantime his job was eliminated in a reorganisation.
The court case will proceed using written evidence from the late director.