On departure the aircraft taxied downwind some distance and turned into wind which was west. We watched with some interest, my chief pilot included, and we all commented that there wasn't enough room. We saw the aircraft leave the water and then settle a couple of times.now getting really close to our dock. It rose for the third time to maybe 50 feet and stalled, dropped a wing and cartwheeled. We ran for the rescue boat and were alongside the wreckage very quick. The two passengers were already in the water so we hauled them into the boat. The pilot was sitting on top of aircraft barely wet.