I am moving out of state, unexpectedly, for husband's work and have many wedding cake contracts signed and deposits paid for next several months.I operate from my home kitchen. I have some ideas on the best way to handle the contracts and keep my business name in the best standing as possible, for when I start again in a new state, but I would like other expert's opinions and thoughts on the matter.
Your best bet would be to meet with a reputable baker (or a few) and find out if they have availability to take over your orders. If they have availability, call each customer and let them know the situation, tell them you will be refunding their deposit, and offer them the option to work with the baker you talked to.
... and you need to do this soon. Best of luck to you in your new home.
I'd give each client several choices of bakers, too. You don't know if the person you're referring them to is someone they interviewed and hated, so having a few to choose from is probably your best bet.