On October 27, 1996, about 1455 eastern standard time, a Lindberg KitFox IV collided with the ground during an uncontrolled descent at Merrit Island, Florida. The homebuilt kit airplane was operated by the owner/pilot under the provisions of Title 14 CFR Part 91, and visual flight rules. A flight plan was not filed for the personal flight. The private pilot and a flight instructor were fatally injured. The airplane was destroyed by a post impact fire. The flight was originating at the time of the accident. A witness reported that the airplane was climbing on the crosswind leg, following takeoff from runway 11 at the Merrit Island Airport. He reported that the engine quit, followed by a turn back toward the airport. The airplane appeared to stall and begin a spin from about 500 feet above ground level (agl). A recovery was made about 75 feet, followed by a secondary stall that resulted in impact with the ground in a nearly vertical nose down attitude. The airplane caught fire at impact. According to an inspector from the Federal Aviation Administration, an experimental airworthiness certificate for the airplane was given to the owner the previous day.(copy attached) The accident flight was the first flight in the airplane. The operating limitations provided with the airworthiness certificate specified that no person should be carried in the airplane during flight unless that person was required for the purpose of the flight. The inspector stated that the owner justified being accompanied by the flight instructor because of the insurance requirement for flight hours in tail wheel equipped airplanes. According to the inspector, the owner/pilot's son-in-law stated the owner/pilot was in the left seat when the airplane taxied out for the flight. A witness indicated that the owner had experienced a fast engine idle, which had been corrected prior to the accident flight. Family members were requested to provide the owner's pilot log and the airplane logbook for examination. They were not received. Xeroxed copies of photographs of the owner/pilot's log were provided by the insurance adjuster, Dick Sample. The log book indicated 558.2 total flight hours with 15.4 total hours between July 2, 1994 and October 4, 1996. The last page of the log contained entries for four flights in a Kitfox with 5.1 associated flight hours. The logbook also indicated that the owner/pilot had a biennial flight review on September 15, 1996, provided by the other pilot in this accident. The non-owner pilot had a commercial certificate with airplane single engine, multi engine, and instrument ratings. Additionally, he had a flight instructor certificate with airplane single engine land rating.