Question: Can a building manager rent out common property car parks to short-term tenants without body corporate approval?
Our building is under the Accommodation Module of Queensland’s Body Corporate and Community Management Act 1997 framework.
We suspect our building manager rents common property car parks to short-term tenants as part of their short-term accommodation (STA) offering, without body corporate approval.
Is this legal? If a short-term rental (STR) tenant’s car is damaged while parked, who’s responsible for covering the cost of repairs? Will the body corporate’s insurance policy cover the damaged vehicle?
What steps, if any, should the body corporate take to resolve this?
Answer: The building manager’s authority is a governance matter, and public liability cover depends on the circumstances of the claim.
The first point to note is whether the use of common property car parks in this manner has been properly authorised by the body corporate (if authorisation is required). Whether the building manager has authority to rent common property car parks will depend on the relevant management agreements, by-laws and any approvals granted by the body corporate. This is a governance and legal matter rather than an insurance matter, and the body corporate should review with their strata manager or consider seeking independent legal advice regarding its rights and available actions under the relevant legislation and management agreements.
From an insurance perspective, the public liability section of a strata insurance policy generally responds when the body corporate is found legally liable to pay damages to a third party for personal injury or property damage. It will also respond to defend against such claims.
In the scenario provided, if the body corporate receives a claim from a third party for damage to their vehicle whilst parked in a common property car park, the insurer would review the circumstances of the claim in full and respond in accordance with the policy wording. A vehicle being damaged on common property does not automatically mean the body corporate is legally liable for that damage. Responsibility for the cost of repairs will ultimately depend on the circumstances surrounding the incident and whether any party is found legally liable for the damage.
Regardless of whether the third party is an owner-occupier, short-term tenant or long-term tenant, the claim would be assessed in the same manner, and the policy will respond in the same way.
It is also critical that, regardless of the circumstances, the body corporate and its representatives do not invite the third party to make a liability claim against them or make any admission of liability before notifying their insurer and obtaining appropriate guidance.
That said, it is worth highlighting that if a component of your complex is leased out in a commercial nature, this should be disclosed to your insurer, as insurers require notification if any part of a complex is used for commercial purposes.
With respect to the actions of the building manager, this would fall outside of what is considered by the strata insurance policy. We therefore suggest that the body corporate discuss the matter with the building manager, review any relevant agreements or approvals, and seek independent legal advice where appropriate.
We recommend you refer to your insurer and/or broker who manages your policy to understand the terms and conditions of your policy, and how it would respond to your current scenario.
This post appears in the October 2026 edition of The QLD Strata Magazine.
Sarah Mumford
BAC Insurance Brokers
E: sarahm@bacbrokers.com.au
P: 02 9360 2244
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