Enemies that flee due to terror are intended to count as defeated and we tested to make sure they do before releasing Mydnight.
Which game mode did this happen in @Jerry_the_skunk ? I’ll do some further testing but if you could let me know the game mode and even a rough time for when you noticed this I will test that game mode and check your logs so I can follow up with as many details as possible.
Currently Gnomes are dropping loot even if they run away and it’s directly tied to Troops fleeing due to Terror counting as kills. So if Terror flees aren’t counting as kills, I need specifics, because it’s not only been working, it’s been working so well it’s even affecting fleeing Gnomes 
I’ll test in PVP.
Edit: Also just to be clear I’m not doubting the reports, just trying to get any specifics I can for the bug report and wanted to mention how it’s intended to work and that it did pass testing so if it’s not working this was a reverted issue 
I remembered after posting this that you all can’t see my body language or hear my tone and you may not know me well enough to know what my attitude towards bugs is, text is hard.
Update:
I did find something that looked odd thanks to Dust Angel’s battle logs.
I’m making a full bug report now.
It was a tricky one as it is being counted as a kill but it looks strange in other places
I’ve added this info to the Damage efficiency section of the Point scoring article for Guild Wars while the team are looking into it:
devtrackers.gg