It is possible. I am far from an expert on NHL contracts, but is there any evidence that this is in fact the case? Are contracts public? I have never heard this before, in a regular contract, for example mine, I can only talk to another company (above board no media will report on me) with permission from mine and they, not me, control how long and under what conditions for any position.
Pretty much all NHL executive contracts have an out for a promotion. Now, there are issues about timelines, which is why Colorado was screwed when Roy quit in August, because almost no team was willing to give permission to talk to their assistants. Its why you only see people promoted when they switch teams unless they are out of contract such as Babcock.
What happened with Dubas and Colorado is quite confusing, and the full story has never really gotten out. What exactly his role was (was it full control of hockey ops? GM under Sakic? or a lateral hire), and who exactly was recruiting him (was it Sakic or was it, Josh Kroenke).
If they shut down the interviews in like August, it would make sense. But, the Dubas situation happened in late May. Now, the Leafs could have told him that they wanted to re-sign him and promote him in time, but then the story would just have been Dubas turned down the Colorado opportunity to extend his contract with the Leafs.
Something weird had to have happened for the Leafs to pull permission. Whether it was due to Colorado being misleading about the type of interview (some claiming that Leafs were letting them ask him stuff about analytics as they searched for someone), but its pretty weird they would allow an interview that could leak trade secrets.
If some team came to the Leafs tomorrow and asked to interview DJ Smith or Sheldon Keefe for a head-coaching job, we would allow that to happen and would only pull permission if they were trying to hire them as assistants. Its pretty much unheard of for a team to grant permission for someone to be interviewed for a promotion elsewhere, and then have the permission suddenly revoked. This is really the only example I can think of in recent NHL history.
The final option is that the interview window closed without Dubas being offered the job.