revealing plot through dialogue is bad??

I have just received probably the strangest justification for rejection of a story that I have received yet. The editor concerned did not like the fact that I revealed plot through the dialogue. But that is showing the reader - would they have preferred that I just dump big chunks of exposition and narrative, telling the reader what is happening? Don't get me wrong - it wasn't just all dialogue and nothing else. There was a lot of action going with that dialogue. But according to this particular editor, revealing plot through dialogue is bad?

I've never heard of such a thing. Bloody nonsense in my opinion, but then they are just as entitled to their opinion as I am.