After takeoff, at about 100 feet above ground level, the engine began to surge. The pilot changed the fuel tank selection and operated the auxiliary fuel boost pump but the engine did not regain power. The pilot then manoeuvred the aircraft in an attempt to find a clear area to land. However, he was unsuccessful and the aircraft collided with trees at a low forward speed. During the impact sequence a fire broke out and almost completely consumed the cabin area and the inboard sections of the wings. Despite the extensive fire damage, small amounts of water and rust were found throughout the fuel system. No other defects were discovered which might have explained the reported engine malfunction, and it was likely that the power loss was caused by water contamination of the fuel. The method by which the water entered the fuel tanks was not established, but may have resulted from condensation and/or the ingress of rain water through the tank caps. The water had not been detected by the pilot during his pre-flight inspection.