IMHO it's best if you put off the meeting with the demon. It doesn't make sense for Yorge to allow the guy with the will to go on the quest - for both of them to face the same danger negates the point of giving him the will in the first place! Perhaps it would be better if there were another threat which required their presence in the city ? Yorge's friend could be appointed regent to further motivate them.
(If you follow that line and the players insist on going anyway, you've plenty of material to work with - they're arguably betraying the city and Yorge and that's got to have nasty resonances on a HeroQuest, which this ought to be).
If that doesn't appeal, I agree that it could be difficult to run the Succession plot as planned if Yorge dies on the quest with the PCs present. Is it possible to delay his death ? Maybe Yorge botches his deal with the demon. allowing it to kill him shortly after his return ? Maybe a loophole in the deal, allowing the demon more freedom than planned - or even allowing the demon to escape control entirely.
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