The passage establishes a difference between a nation's laws and a higher moral code. This code is the standard by which laws are judged.
The wording of the last sentence is meant to be confusing. However, it basically represents the same distinction given above. If you were able to get the right answer, then you might understand it as well is at can be understood. However, I'll give my explanation and maybe that will add some clarity.
Under what circumstances would the moral code have to allow for exceptions in the legal statutes? In case that these two rule systems are not identical. I take the conclusion to mean that there are times when an action is illegal but not immoral. Violating the law is not always morally wrong. This represents a conflict between the two codes, which is best expressed by answer choice E.