The phrase is used by biblical scholars. The translation they use is "Situation in Life." Meaning that any translation or attempt to interpret any religious text, must be first placed in it's historical context. For example, when you look at Paul's letter to the Corrinthian's describing the behavior of women, you have to first place it into it's historical context. Dammit, I wish I had my research on this because I've lost my train of thought.
Regardless, before we so hastily cast our current beliefs and understandings onto a historical text, we must first place it in the context it was written, and understand for whom it was written. Without this element, we lose the clarity of message. This doesn't necessarily mean that we will have the right interpretation, but it definitely gives one pause before they begin to presume they understand "exactly" what the texts mean.
If anyone wants to discuss this in depth, I will be happy to but, I will first want to get my notes on the topic, which will be later tonight.
