Before departing on the initial flight from Los Angeles, CA, the pilot drained a large amount of water from the fuel tanks. After making a battery start, the pilot and two passengers departed on a flight to the Santa Catalina Airport where they had lunch. From there, they flew to Torrance, CA and refueled with 27 gallons of 80/87 octane fuel before returning to Los Angeles. During the departure from Torrance, the plane was observed in a shallow climb. During the climb, the engine was heard to decrease in power. The aircraft entered a steep bank, the bank was shallowed out, and then a steep bank was reentered. After that, the nose dropped, the aircraft dove toward the ground, then crashed and burned. An examination of the wreckage and a disassembly of the engine revealed no preimpact malfunction or failure. The last annual inspection of the aircraft was dated 3/17/81. The last annual of the engine was dated 2/22/80.