I just had this encounter in my game. This quest is confusing and doesn't make sense if you make your way through this location in the "wrong" order. I met Balthazar first. It's almost like they want you to find him first because there are three skeletons, which when encountered are neutral, but some Justiciar Avengers teleport in and a fight breaks out. Two of the skeletons survived the encounter and ran down the hall to the west, so I followed them. I speak with Balthazar and left him alive (for now), and completed all of the trials. I was still missing an orb to open the last door. On my way back to explore some more, the rats beside that elevator attacked us when we walked by. It didn't start a combat encounter, they just bit a couple of us we walk by. I attacked and killed them, then another appeared and spoke to me, and I agreed to leave them alone.
I then found Yurgir, and decided to try and free him from his contract. While talking to him, I figured it had something to do with the rats, and the journal update even mentioned the rats. I went to go talk to the rats again, but I couldn't find any rats at all. After wandering around for a while, I finally found the way down to the base of the statue, read the book, clicked the altar and it completed the quest. I didn't know why that completed the quest, so go back to talk to Yurgir, and the only options I have are to tell him I'm still looking or attack.
This quest definitely needs to be updated to take into account the other order(s) in which you can stumble upon things in this location. A quick search finds several people confused about this quest, because depending on the order you do things here and your actions, locks you out of freeing Yurgir from his contract before you even meet him. It seems a simple solution would be to not have the rats disappear so you can break your agreement with the rats to free Yurgir from the contract.
