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than a single transaction. First, neither the mother nor her
estate was a party to the settlement trust created 4 years after
the mother's death. Second, it was not the creation of the trust
that gave rise to the tax liability that the Government claimed
existed with respect to the mother's estate. The mother's estate
tax liability existed because she possessed a valuable right when
she died, the claim against the stepfather for conversion,
embezzlement, and breach of fiduciary duty. The Court of Appeals
for the Ninth Circuit reasoned that these "transactions" (the
mother's death or the stepfather's tortious conduct giving rise
to the mother's chose in action) were undeniably separate from
the event giving rise to the sisters' refund claim--the
stepfather's death and the concededly erroneous taxation of his
estate. See Parker v. United States, supra at 684. While the
Court of Appeals conceded that the creation and taxation of the
settlement trust were in some ways related to these various
transactions, it found that any factual and arithmetic link
between them was insufficient to enable the Government to succeed
in its claim for recoupment. See id.
In contrast to Parker, in which the mother was not even a
party to the creation of the settlement trust, in the case at
hand, petitioner both undervalued and sold the shares of stock
that gave rise to the estate tax deficiency, and the same
undervaluation and sale automatically resulted in petitioner's
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