The way the program works is it creates those Priority Based Connections for certain element types automatically. That trumps all, including SEO (PBC in itself being an automatic SEO). For example, it will create such a connection between a Wall and a Slab, and the stronger will always cut the weaker, so then performing an SEO with the weaker as Operator cutting the stronger as Target will not make a difference, because the weaker is already cut so it has no geometry intersecting the stronger at the moment the SEO command is issued. The SEO is performed, it just has no visible result as there are now intersecting geometries. This is important to understand.
This is how it works internally, as fair as I know:
When there is an automatic Priority Based Connection between a Wall and a Slab, and the BM of the Wall has a higher Intersection Priority, a "Subtraction" SEO is performed, with the Wall as Operator and the Slab as Target. Therefore if you now do a "Subtraction" SEO, with the Slab as Operator and the Wall as Target, no change in either geometry occurs because they don't actually have intersecting geometries since the Slab's intersecting part with the Wall was already cut by the Wall because of PBC. This is why the SEO doesn't work in this case. The Priority Based Connection already performed the SEO on their intersecting parts.
You cannot cut from A by B the intersecting portion which has already been cut from B by A.
However, in cases where a Priority Based Connection is not performed automatically, the intersecting geometries are there and therefore SEO works as expected. For example, if that Trim was modeled using a Morph, you could perform the SEO to cut the Wall (since no internal SEO is performed automatically between the two based on Intersection Priorities and the intersecting geometries are there):
This is the table that shows which connections are performed automatically on which element type combinations:
http://helpcenter.graphisoft.com/guides/archicad-17-guides/archicad-17-int-reference-guide/virtual-b...
Edit: based on a tweet by James Badcock:
https://twitter.com/JRPBadcock/status/616181976853282816
another good point: PBC is skin-based, while SEO is element based. Just something to keep in mind.
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