Preheat oven to 350 F. Place butter in a medium sized skillet and melt over medium heat. Add onion and pepper and saute until tender. Add all the seasonings and cook for about 5 minutes. Stir in the milk and ketchup; cook for about 2 minutes. Remove the bay leaf. Let cool slightly.
In a large mixing bowl, mix cooked sauce mixture, ground beef, egg and oats. Stir to combine. Form into a loaf and place in a greased baking dish. Bake for one hour.
In a small bowl combine ketchup, brown sugar and Worcestershire sauce to form a glaze topping. Spread on top of baked meatloaf. Place under the broiler for about 5 minutes, until bubbly.