Are private parking fines lawful?

Published by Peter Nugent

The use of private parking fines and penalties is currently a hot topic in the Brisbane media. Queensland Transport Minister Mark Bailey has foreshadowed a ‘crack-down’ on private car park owners in the coming months.

One of the complaints is that the operators are accessing registration data to send penalty claims to registered car owners.

In this article, we answer key questions regarding penalties for illegal parking to help landlords and car park operators understand their legal position.

Who can charge penalties? 

Under Australian law, only courts and governments can charge and impose penalties for illegal parking. The owners of private property cannot issue such fines or penalties. Any claim by a private person must be established under a contract or through a court action for trespass.

Who can park on your property?

A person parking on private property is a trespasser unless the land owner has consented to the parking. That consent will be implied for a commercial building car park unless a restriction is obvious from a sign or the use of a gate.

A sign at the entrance to a car park could give a specific licence, and a person parking is or becomes a trespasser if they do not comply with that licence. Such a licence is not necessarily a contract, but could be used to create a contract for parking.

If there is no contract, then a claim for unlawful parking can only be based on trespass and is a claim for general damages. A claim for a specified amount must be a valid claim under a contract and the amount must be either an agreed parking fee or enforceable liquidated damages for breach of a contract allowing the parking.

How do you create the contract?

For an effective contract, there must be an offer and acceptance, an intention to form a contract and consideration.

You can form a parking contract by making the offer on a sign at the entrance of the car park. The offer is accepted by the driver entering and parking. Contracts like this have been considered in numerous cases. The key requirements are:

  1. you must be able to show that the person parking is aware of the offer, the terms, and that continuing to park demonstrates an acceptance of the offer
  2. the terms you want to rely on must have been reasonably available to the person before they take an action that constitutes the acceptance of the offer.

Should you claim consideration or liquidated damages?

Generally, the law does not care whether the consideration for a contract is reasonable. You can demand any amount as the agreed payment under a contract. On the other hand, there are rules to determine whether the agreed liquidated damages are enforceable or constitute an invalid penalty.

If your contract provides that parking is offered on the basis that, say, $220 is payable as consideration for parking more than two hours, then that is an enforceable claim unless restricted under a statutory regulation (currently there are none).

If your contract provides that the $220 is liquidated damages for breaching a promise to leave within two hours, then you have to show that amount is a reasonable estimate of the loss you suffer from the breach and is not intended to terrorise the person into compliance. If you offer free parking, then demonstrating a financial loss from overstaying could be tricky.

The media stories also talk about the demands being increased by administrative costs. Those claims are not liquidated amounts and are therefore even more problematic.

Other problems you may encounter

The contract is with the person driving the car. That may not be the registered owner. If a claim is sent to the registered owner then it has to be proven on the balance of probabilities that person was driving the car.

More importantly, a demand for payment without a reasonable basis is potentially misleading and deceptive conduct and an offence under Australian consumer law. While any action would be unlikely, the over-aggressive pursuit of people could lead to some sort of investigation.

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