The template match="Priority/PriorityList" matches all four of your PriorityList elements. It will be invoked to process them provided that (a) the elements are selected for processing in an xsl:apply-templates call, and (b) there is no higher-priority template rule that matches those elements.
I'm not sure what you mean by the second part of your question. It might help to show your current code and explain whether or not it does what you expect.
Michael Kay
http://www.saxonica.com/
Author, XSLT Programmer's Reference and XPath 2.0 Programmer's Reference