On September 4, 2007, at 1914 Pacific daylight time, a Higher Class Aviation Sport Hornet, light sport aircraft, N155HC, was substantially damaged when it impacted terrain following a loss of control during a VFR go-around at Santa Paula Airport (SZP), Santa Paula, California. The flight instructor and his student were seriously injured. The student/owner was operating the airplane under 14 Code of Federal Regulations Part 91. Visual meteorological conditions prevailed for the cross-country flight, which originated from Ramona, California, approximately 2 hours before the accident. No flight plan had been filed. The flight instructor said that they were transporting the newly manufactured airplane to the state of Washington. On their initial departure from Ramona, the engine lost power and they landed straight ahead on the remaining runway. A new fuel flow meter with a restriction had been installed in the airplane. This unit was removed and a ground run up test along with a flight test was performed. They departed at 1700 and flew for approximately 2 hours with no difficulties. A witness said that the airplane was landing on runway 22, and appeared to be "too fast." He said the airplane aborted the landing and during the go-around, the engine began to sputter. The witness said the airplane started a turn back towards the runway when the airplane "spun into the Santa Clara River." The flight instructor said that when the power loss occurred, at approximately 200 to 300 feet above ground level, he took control of the airplane and turned towards an open area to his left. As he banked, the airplane impacted terrain. Several structural pieces of the fuselage were bent or broken. A post accident examination of the engine by a National Transportation Safety Board investigator, an engine manufacturer's representative and the owner was accomplished on December 13, 2007. They identified no abnormalities with the engine; the reason for the loss of engine power was not determined.