From the Super Mario Wiki
In the Washroom, the toilet tank above the toilet is leaking. As Luigi approaches it, a Water Elemental Ghost emerges from it. Luigi uses the Water Elemental Ghost to defeat the Temper Terror that attacks next. This turns the lights on and causes a treasure chest with some extra money inside to appear.
The Washroom on this floor is very similar to the one on the first floor, the only differences being the absence of Toad, and a "Monsters" poster replacing the medicine cabinet. The sink also often contains a Heart.
Ghosts during the blackout