Shake chicken pieces in bag with flour and salt and pepper; brown in butter and oil. Place browned chicken in greased 3-qt. casserole dish.
Combine orange juice with vinegar, sugar, basil, and nutmeg and pour mixture over chicken. Cover and bake at 375°F. for 1 hour and 15 minutes, or until tender. Baste often.
Then place peach or apricot halves between chicken pieces, baste well, and bake uncovered for 15 minutes longer.
