With modded $500 cars and amateur drivers, body contact...happens, accidentally. If it's an accident, everyone understands, though there can be small penalties. Overly aggressive driving (judge's discretion) can result and violent contact will result in a black flag (car must leave track for series of escalating penalties, up to disqualification). Tires are not permitted to leave ground in 24HoL events (i.e. no jumping). Rollover = red flag (immediate disqualification and driver suspended for 12 months from 24HoL events).
A lot of the body damage can be left over from the car becoming a $500 car in the first place...