Most combat engines of the time use similar mechanics. When a player attacks they roll against an attack table. Likewise, when you attack a player or a mob/another player attacks you they use similar lists. This typically looks something like:
Miss
Dodge
Parry
Block
Critical hit
Ordinary hit
Attack rolls are done in descending orders of precedence. That is to say that every attack has a chance to miss, be dodged, parried, blocked, etc. as it goes down the list. Character modifiers shown in the character tab are % based and reflect the actual effects against the same level mobs and/or players.
How these work is something like this:
Player attacks a mob and misses - no more action against the table
Player attacks and does not miss, rolls against the mob or other players dodge rate. If it is 10%, then the attack will be dodged about 10% of the time.
Player attack does not miss and is not dodged, rolls against the mob or other players parry rate. If it is 50%, th
en the attack will be parried about 50% of the time.
This continues down to the last entry of a regular hit.
Certain mechanics won't always apply as is the case of block. Typically block only comes into play when either the player or their opponent has the ability to block (shield equipped) . So if the player/mob is not equipped with a shield then that element is not used when calculating the attack.
We can't be 100% certain of course since this information has not been released by RW. Again, this is an assumption based on very similar combat mechanics used by other MMOs that have shared the same type of mechanic. Another thing we don't know for sure is if the modifiers can be effectively stacked to the point that it becomes impossible for a mob land a solid hit. My feeling is it is not, that in order to avoid getting hit a player would need 100% dodge, 100% parry and if a shield is equipped 100% block but again, I'm not able to verify that so it is merely a best guess on my part.
Here is my source:
http://wowwiki.wikia.com/wiki/Attack_table
Hope this helps