The Sefer Chassidim writes that there are places where the custom is to refrain from naming a child after a living individual.
The Chida shows us a hint to this in קראו בשמותם עלי אדמות, they have proclaimed their names throughout the land. He interprets this phrase to mean that children should be named after those in the ground meaning a children should be named after those who have been interred (i.e., passed away).