It depends on the context but the legend is probably a box on a document which explains the codes or abbreviations used when grading exams. Someone can be informally described as a "legend" if they work really hard and go a great job. So someone who does a great job of grading could be described by his fellow teachers as a "grading legend".

A grading legend is a grading scale. It's a reference to what your letter grade in a class will be. For example: 100-90% ------- A 89-80% ---------B And so on. It's used in school or classroom settings. If you google it you can see better examples!