Damage redirection in Warhammer Invasion
The order should proceed like this:


All damage is assigned (leave the damage tokens near the unit to be damaged)  Note: a target may be over assigned damage at the player's discretion but this is not required except in the case of damage cancellation even when you know the unit will survive due to other protective effects
Certain effects trigger and are resolved including redirecting damage.  In this case, the Priests are able to redirect one damage point, preferably to a unit with toughness
Damage is moved onto the card, destroying any cards that still have damage equal to its hit points.


Source - FAQ and Rules on Fantasy Flight's website