Child node inherit taxonomy terms from parent (via url argument)

Hi, I'm creating my first module that will take a node ID passed as an argument in the URL and have the created node inherit the taxonomy terms of that parent. Also, there's two options: either inherit all terms, or just terms of a particular vocabulary.

The main reason for this is I have a site that uses Taxonomy Access Control Lite and Node Relativity. The problem is, that when a node belongs to a restricted vocabulary or term (by Tac Lite), the created child does not inherit any taxonomy from it's parent so is fully accessible to all users.

I tried adding a direct database insert into the node_access table via the Node relativity module which sort of worked but did not update the site permissions which I had to do manually after every node creation. So, I figured I'd make this a module in itself so it's not reliant on the Node Relativity module and try and add the taxonomy through the normal drupal process hoping that it would go through whatever process the Tac Lite module uses to make sure the permissions table is updated.... I could be wrong.

I have most of the groundwork done but I can't for the life of me find anything online or figure out how to code adding the taxonomy to the node being created.

The module admin settings, you define if all terms to be inherited, or if not, specify which argument should be used (1,2,3,4 etc $passtax_arg)

Here's the nodeapi code which I thought may work but gives me a white screen of death when I insert the node.... although, the node still gets created:

/**
 * Implementation of hook_nodeapi().
 * Not really sure how to do this but must suss it out :p
 * @param string $node holds current node data
 * @param string $op one of "list", "view", "save" and "configure"
  */
function passtax_nodeapi($node, $op, $arg = 0) {
    $passtax_arg = variable_get("passtax_arg", 0);
  switch ($op) {
    case 'insert':
      // dean - only apply this if argument exists
      if ($node->nid && is_numeric(arg($passtax_arg)) && $passtax_arg != 0) {
        $parent_node_array = node_load($passtax_arg);
        if (!empty($parent_node_array->taxonomy)){
          foreach ($parent_node_array->taxonomy as $term) {
            $node->taxonomy[] = array(
            'tid' => $term['tid'],
            'vid' => $term['vid'],
            'name' => $term['name'],
            'description' => $term['description'],
            'weight' => $term['weight']); 
          }
                // drupal_set_message(dpm($parent_node_array->taxonomy)); // debugging only
        }
      }
      break;
  }
}