twists and turns, eh?
Legally, Balrog was in the right - the Fellowship committed what any lawyer would have labeled 'breaking and trespassing'. Legal defence may have pointed out that Balrog was a squatter, occupying dwarven halls legal owners never put their claims down to, but, on the other hand, as the prosecution may have retorted, dwarves themselves were guilty of selfsame 'breaking and trespassing' in the first place, as they dug into Balrog's original habitat in the lower halls without any legal ground whatsoever.
Accussed returned guilty, your honour!
So, it is just as well M-E haven't got lawyers