The documentation for configuring contexts (http://tomcat.apache.org/tomcat-5.5-doc/config/context.html) states that "You may define as many Context elements as you wish." However, it doesn't say that each context has to be defined in a different file. This is especially confusing as putting more that one <Context/> element in a single context.xml file will give the error message "SEVERE: Parse error in context.xml" for each webapp with the exception message " The markup in the document following the root element must be well-formed." This indicates that the problem is with the XML syntax instead of the semantics of context definitions.
I have added a note to the context docs which will be included in 5.5.27 onwards and 6.0.18 onwards.