A person cannot be assumed dead unless the court issues a decree that he or she is dead.
Responding to the question, the eminent scholar and renowned da`iyahSheikh Abdel Khaliq Hasan Ash-Shareef states the following:
In such situations, a person can be simply declared dead if the dead body is there and can be easily recognized. In case there is no corpse, and the person is absent for a long period, then the local court has to issue a decree that such-and-such person has died after exerting all possible efforts to find him or her. If there is no way to find that missing person and the court has issued its decree, then there is nothing wrong in indicating publicly that the person is dead. All in all, the families of those missing persons should make sincere du`aa (supplication) for their relatives whether they are alive or dead.