exception handling

[Jack Zhou]

I found a paragraph in blueprint.

A SOAP fault defines system-level exceptions, such as RemoteException,
which are nonrecoverable errors. The WSDL fault denotes service-specific
exceptions, such as CityNotFoundException, and these are recoverable application
error conditions. Since the WSDL fault denotes a recoverable error condition,
the service can pass it as part of the SOAP response message. Thus, the
standards provide a way to exchange fault messages and map these messages to
operations on the endpoint.

I thought, in the Document/Literal, sender and recevier are mainly exchange xml documents. Then in which way an application exception is supposed to be transmiited? Above paragraph indicates that it is not appropariate to send back an application exception to client as a soap fault, in stead it should construct a normal soap message that describes the appliaton specific excetpion. Is this right?
Thanks,