Flournoy

This is an inheritance tax case. The appellant is the State Controller, Houston I. Flournoy (Controller). The respondent is the Security Pacific National Bank as the trustee of the Kruse estate (Trustee). Controller appeals from a judgment (order) of the trial court modifying an earlier order fixing the inheritance tax and directing payment of a tax refund to the trustee. We affirm.

*912 Facts

Clara Kruse died in January 1959, leaving a holographic will, which was probated. A trust was established under the will. The order for preliminary distribution of the estate, 1 filed in December 1959, provided in relevant part for the distribution of the estate as follows:

The taxable estate totaled about $854,000. Excluding certain small bequests, the order fixing inheritance taxes, filed in January 1960, taxed the interest of the son, assessed at approximately $714,000, in the amount of $58,611.49.

The husband died in February 1967. The son died in November 1970, at age 54, leaving 65 percent of the trust estate. This amount was then distributable to the six blood relatives, all still living. His early death meant that in retrospect the tax had been fixed at too high a…