According to the 2002 Annual on page 106 under Magic, Spells cannot be targeted at models which are out of line of sight.
According to the Mordheimer's "Ultimate FAQ" -
Q: If a spell does not specifically state that Line Of Sight is needed, do obstacles or
buildings prevent a model within range from being hit?
A: No. [Tuomas, Mordheim Yahoo! eGroups' FAQ]
I think we stick with the official Annual.
The spells we are looking at are - Lifestealer, Spell of Doom, & Living Horror
Thanks for your thoughts.