Okay. That's kind of a tough situation.
If you let the character die, then you have to find some way to introduce a new character into the story, right before the final part of the adventure. If you don't let the character die, then you're telling the players that their actions don't matter because you won't let them fail.
You could ask the player if he knows what kind of character he wants to make to replace the halfling. If he does, then great, and you can work on integrating that character into the story. (Maybe start the character with less equipment, or one level lower, so there's still some penalty for failure.) There are lots of games and stories that introduce a new character for the last chapter, so that's not too weird.
The only cases where I would recommend fudging the outcome, to let the character live, is if it was absolutely vital to the plot (if he's the Chosen One, and the game is over if he dies), or if the it's a new player who didn't know that final death was possible (and it was just bad luck or a critical hit that killed the character, and the player wasn't doing something dumb to cause the death).