Bring milk, onion and bayleaf to a full boil. Let stand for 10 minutes. Strain. Over low heat, melt butter in sauce pan, add flour, cook until light brown. Gradually add milk and cream, stirring constantly, until mixture starts to boil. Stir in salt and pepper to taste. Cook over low heat, stirring often, about 10 minutes. If not completely smooth, strain. Sprinkle in cheese; Stir until melted and smooth. Serve with pasta, eggs, vegetables or fish.