Heat olive oil in nonreactive saucepan. Saute the onion, garlic, salt and pepper until tender. Stir in the mushrooms and saute for 2 minutes. Add the zucchini, yellow squash, thyme, oregano, and basil and saute for 5 minutes. Add the tomatoes and cook 5 minutes more. The vegetables
should be tender, but not browned. Remove to a large saucepan and add the tomato sauce and the bay leaf. simmer the sauce for about 30 minutes or until it had thickened and the flavors are blended. Remove for the heat and season with salt and pepper to taste.