That indeed would be a question for Lord Lyon to answer, because it is only he who can make that decision. However, my own thoughts on the matter would be that the arms belong to the M'Iver name and may possibly be available for a M'Iver of the broken clan - one of them may be accepted as the current Chief if he/she were to apply to Lord Lyon and resurrect the Clan M'Iver
If the chap who made his allegiance to the Duke of Argyll died without either male or female issue, I would have thought that the Chieftainship would automatically pass to one of the 'broken-Clan' M'Ivers in the manner similar to how a title is passed to another branch of the family in the remainder of Britain (ie., third cousin or great nephew, and so on, etc.).
Chiefship is a title of honour and dignity within the nobility of Scotland. Any claimant to such a title must establish, to the satisfaction of the Lord Lyon representing the Sovereign, that he or she is entitled to the undifferenced arms of the community over which they seek to preside. It is the determining of chiefship which is among the Lyon Court's central work.
Many of the cases which have come before the Lyon Court in the last 50 years have related to the chiefships of clans. There are now about 140 clans that have chiefs recognised by the Lord Lyon.
A clan or family. which has a recognised chief or head confers noble status on the clan or family which gives it a legally recognised status and a corporate identity. A family or name group which has no recognised chief has no official position under the law of Scotland.
The Lyon Office would definitely be the place to make your enquiries. Lord Lyon, himself, has an email address firstname.lastname@example.org
and you should be able to contact the Lyon Office through their webpage to be found at www.lyon-court.com/
and another URL that you might find useful is www.myclan.com/clanship/heraldry/court.php
Let us know how you get on if you do contact the Lyon Office.