The Clients’ Waiver of Their Rights Under Regulation BI of the Securities and Exchange Commission

TAMAR FRANKEL

BU Law emerita professor Tamar Frankel discusses the Securities and Exchange Commission (SEC)’s Regulation Best Interest (BI), which imposes on broker-dealers a commitment to act in the best interests of their clients. Specifically, Frankel addresses the SEC’s treatment of client waivers of the Regulation BI, which goes even further than general fiduciary law to prohibit any waiver of the broker-dealer’s conflicting interests.

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Castillo v. United States

Docket: 19-1158

Opinion Date: February 20, 2020

Judge: Richard Gary Taranto

Areas of Law: Constitutional Law, Real Estate & Property Law, Zoning, Planning & Land Use

The plaintiffs own land abutting a railroad right-of-way that was long ago granted to, and for decades used by, the Railway in Dade County, Florida. When the Railway abandoned the right-of-way for rail use, full rights to the underlying land, unencumbered by the easement, would have reverted to whoever owned such rights, had there been no overriding governmental action. However, the Railway successfully petitioned the Surface Transportation Board to have the railroad corridor turned into a recreational trail under the National Trails System Act Amendments, 16 U.S.C. 1247(d). The landowners sued, alleging that the agency’s conversion of the right-of-way into a recreational trail constituted a taking of their rights in the corridor land abutting their properties and that the government must pay just compensation for that taking. To establish their ownership of the corridor land, the plaintiffs relied on Florida's “centerline presumption,” which provides that when a road or other corridor forms the boundary of a landowner’s parcel, that landowner owns the fee interest in the abutting corridor land up to the corridor’s centerline, absent clear evidence to the contrary. The trial court ruled in favor of the government. The Federal Circuit reversed. The centerline presumption applies to railroad rights-of-way and the plats at issue do not clearly express the intent required to avoid application of the centerline presumption.