Sauté veal in butter with the onions. Stir in flour and cook a few minutes. Add wine, garlic, bay leaf, thyme, and parsley. Set lid ajar and simmer about 1 hour. Discard bay leaf, thyme branch if used, and parsley. Add 1teaspoon salt and season with pepper.
Peel the onions. Put them into cold water, bring to a boil, drain, and rinse. Brown onions and mushrooms in a chunk of butter. Add to the stew. Cook another hour, or until stew is done. Add sugar and Madeira. Stir, taste, adjust seasonings and thickness with beurre manié). Cook potatoes during last hour. Serve potatoes separately, or add to the stew.