FAIRHOPE, Ala. — The Fairhope nightspot shut down this month by the city following arrests of a bartender for selling cocaine and its owner for possession of gambling machines there got its business license back Monday night from the City Council.

Acting as a quasi-judicial body in an administrative hearing, the council overturned Mayor Tim Kant’s temporary suspension of the business license of Jubilee Bar & Grill, located at 902 Morphy Ave., just east of Greeno Road.

“I think it’s effective immediately,” said Fairhope attorney Robert Stankoski on Tuesday, regarding the status of his client Peyton McKay’s business license. “I guess he could open today if he wanted to.”

A March 18 letter sent from Kant to McKay informed him of the city’s intent to revoke his business license. An earlier March 12 document signed by Kant, which was posted at the business, indicated the license had been suspended.

“The reason for revoking the said business license is due to the following pending criminal charges that occurred at the business premises: seven misdemeanor counts of gambling, possession of a firearm while drinking, and operating an establishment where one of your employees sold illegal drugs seven times,” Kant’s March 18 letter to McKay stated. “As Mayor of the city of Fairhope, I am also notifying you to appear before the City Council at the March 22, 2010, City Council meeting in regards to the suspension pursuant to the City of Fairhope’s Code of Ordinances. At this meeting, you will show cause why the City Council should not revoke such license.”

During the Monday administrative hearing before the council, Chief of Police Bill Press described a series of incidents this year at the lounge at which an undercover police officer purchased powdered cocaine from an employee in front of McKay, and observed other activities leading to felony charges against that employee and misdemeanor charges against owner McKay. That undercover officer also testified before the council on what she observed.

Press argued that the council should revoke the license based on the illegal activities at the lounge, according to city ordinances regarding the revocation of local business licenses.

Stankoski countered that his client had not been charged with any crime related to the cocaine sales, and that other lounge businesses in town also had gambling machines on their premises but no action had been taken to revoke the licenses of those businesses.

“You can’t unfairly single out Jubilee Bar & Grill,” said Stankoski, noting that doing so would involve a constitutional equal protection violation against his client.

Before the hearing began, Kant noted that this was the first time during his two and a half terms in office the city had ever sought to revoke a local business license. He said he had signed the papers to do so on recommendation of Chief Press.

“This is the first time,” Press said, agreeing with Kant, whom he thanked for issuing the temporary suspension. “We do want to send a clear message that drugs will not be tolerated.”

Following the almost hour-long hearing, Council President Lonnie Mixon asked for a motion to uphold Kant’s temporary suspension. Councilwoman Debbie Quinn made the motion, but it died for lack of a second.

City Attorney Marion “Tut” Wynne said the effect of the council’s failure to take an affirmative action at the hearing was for the suspension to expire.

“Probably the way it should have been done was for a motion to overrule the mayor’s decision,” Stankoski said. “Then they would have voted ‘yea’ on that. But they kind of did it in reverse. The conclusion is they did not follow what the mayor had done. The mayor suspended him, and when they took no action to follow what he did with his emergency power, then it fails. The mayor has no power to do that long term. It’s an immediate quick thing he can do until the City Council hears the evidence.”

Only four council members heard the case involving Jubilee Bar & Grill because Councilman Dan Stankoski removed himself before the hearing began. He did not make a formal statement of recusal, but apparently left the dais because his son is McKay’s attorney.

McKay’s pending misdemeanor charges of possession of illegal gambling machines are set for trial May 10 in county district court.

“It could be reinstated,” said Wynne, regarding reissuing a suspension of McKay’s business license, depending on the outcome of the district court trial.