Sometimes it becomes necessary and reasonable to be formal as per PS’s suggestion. Other times that can be overly bureaucratic. It would seem here that the informal approach has been working perfectly well and causing nobody any problem until this second person came along.
I would still say the key is that the first person’s use is reasonable, infrequent and not the cause of any complaint, so it was fine to carry on this way until the second person came along, and it might still be fine to continue this way. What person #2 wants is clearly different. It is not infrequent, occasional use; it is 100% of the time use. I would be just saying no to person #2 and preferring to stick with status quo for #1.
If #2 wants to make a fuss, then perhaps a solution would be to give everyone permission “to park one motor vehicle on the common property for a reasonable, low level of infrequent usage not exceeding an average of 2 days a month” (or some other formula that matches the actual low frequency of use by person #1). That would be fair and avoids an accusation of playing favourites. It would not subvert planning guidelines, or only very slightly. It would explicitly state the principle that residents should not expect to be able to use the common property for routine parking but it would recognise that it would be petty and pedantic to never allow it, not even for rare and unusual circumstances. At some time, nearly everyone needs to move their car out of the garage for some one-off or temporary unusual event – maybe having a fridge or couch delivered to there or while making a repair to the garage. This new by-law would allow person #1 to keep doing what they do within a limit that is agreed to cause little inconvenience to others but it would not allow people to turn their garages over to some other use while relying on the common property for parking.