Quote Originally Posted by The Pilgrim View Post
My rationalization of the Rules is that if the Phylactery is destroyed, the soul/life force/life essence (all three terms are used in different versions of the Rules) returns to the Lich. But that is just my rationalization, the rules never state what happens with whatever the phylactery holds according to the rules, if the item is destroyed.

But, all in all, I think we can agree on something:
Spoiler: SoD
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Redcloak's plan on keeping control over Xykon by holding the Phylactery never made much sense.
Not sure if you're actually saying that the rules don't say what happens to a lich whose phylactery is destroyed, but to those (possibly including you) who do think so...

A lich whose phylactery is destroyed suffers no harm, but cannot construct a new one.
Libris Mortis p.151.