Clip automation is processed before the effects are processed. Volume and pan track-level automation is processed after the effects are processed.
This can be important in some cases, for example, when an effect is mono-only, it doesn't do any good to automate pan at the clip level, because the panning would be lost when it reached the effect. In those cases, pan in the track's automation lane.
Acoustica Distortion and Shred Amp Simulator are a couple examples of mono effects.