THE STUDENT PLT TOOK OFF ON A DARK NIGHT IN MARGINAL WX CONDITIONS WITH 2 PASSENGERS OCCUPYING THE ONLY PASSENGER SEAT. ABOUT 17 MIN LATER, THE ACFT WAS OBSERVED IN A LOW PASS OVER A PIER AT NEWPORT BEACH, CA, FLYING TOWARD THE OPEN OCEAN. AFTER CROSSING OVER THE PIER AREA, THE ACFT ENTERED A TURN, DESCENDED INTO THE OCEAN, CRASHED & SANK IN ABOUT 40 FT OF WATER. BOTH PASSENGERS WERE FOUND IN THE ACFT. THE PLT'S BODY WAS FOUND ON 3/21/85 ABOUT 4 MI SOUTH OF THE ACCIDENT SITE. NO PREIMPACT PART FAILURE OR MALFUNCTION WAS FOUND DURING THE INVESTIGATION. A WITNESS REPORTED THAT THE ENG SOUNDED FINE PRIOR TO IMPACT. TOXICOLOGY CHECKS OF THE PLT REVEALED HE HAD A BLOOD/ALCOHOL LEVEL OF 0.15%, BRAIN TISSUE HAD 0.2 MICROGRAMS/GRAM OF COCAINE, & LIVER TISSUE HAD 0.4 MICROGRAMS/GRAM OF BENZOYLECGONINE. HOWEVER, THEAMOUNT OF ALCOHOL DUE TO PUTREFACTION WAS NOT VERIFIED. THE PASSENGERS WERE FOUND IN THE ACFT ABOUT 6 HRS AFTER THE ACCIDENT. THEY TESTED POSITIVE FOR ALCOHOL, COCAINE & BENZOYLECGONINE. ACFT ESTD TO BE 124 LBS OVR ITS MAX GROSS WT LMT.