Place all meatball ingredients in bowl except flour and oil and mix well. Form into small balls and coat in flour. Fry in oil until the surface is golden. Remove and drain on paper towels. In another pan saute second onion in olive oil until golden. Add clove, bay leaf, pepper and meatballs. Pour in the sherry and stock. Mix well. Transfer to baking dish and place in 350 degree oven for 40 minutes. Check periodically and add more stock if necessary.