The Soul Cage was invented by Mordra to trap the Liche in Horance, so that the Liche Potion could destroy him. However, Trent, the blacksmith of Skara Brae, died in a fire before he could finish it. His ghost continued the work quite fruitlessly until the Avatar helped him overcome his rage. When it was finished, it was bathed in the Well of Souls. Now that it was empowered, it was ready to be used on Horance during the "Black Service".
It was destroyed, after the potion took effect, dissolving into dust.