Season the chicken pieces with salt and cayenne. In a large sauté pan, heat the oil over medium-high heat. When the oil is hot, add the chicken and brown well on both sides. Remove the chicken from the pan and set aside.

Add the onions to the pan, and season with salt and pepper. Stirring constantly, wilt and brown the onions, scraping the bottom of the pot to loosen any brown particles, for about 10 minutes. Add the bell peppers and mushrooms, and continue cooking, stirring frequently and scraping the bottom of the pot to loosen any brown particles, for about 6 minutes. Sprinkle with the flour and add the bay leaves and cook for 2 minutes.

Return the chicken to the pan, add the water, cover, and reduce the heat to a simmer. Cook for about 1 hour, or until the chicken is very tender. Stir in the parsley. Season to taste with salt and cayenne. Spoon the chicken and sauce onto a platter and serve warm.