Dead person - use the third form of if-clause?

If the mother of the son was died when he was born, and after 10 years, when his father wants to tell him that if his mother was still alive, she would be very happy. What should the father says?

1. I am sure your mum would have been very happy. <- This is what I heard from the actor.

2. I am sure your mum would be very happy.

Please also kindly provide explanation.

Thanks a lot!