A garrison unit can only choose to Hold or Stand and Shoot, it cannot choose to Flee! – it would take far longer for the garrison to exit the building than for the enemy to flow around the sides and run the garrison down. Even a failed Terror test will not exhort a garrison to Flee! – it is better to face a mind-numbing peril with four solid walls around you! Accordingly, a garrison that fails its Terror test does not flee as normal, but is forced to Hold.
Source: Warhammer Armies Project: Unofficial 9th Edition (v2.2)
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Parent:Assaulting a Building