In a large saucepan heat oil and melt butter over medium heat. Add garlic and shallots and saute until soft, then add chicken, season with salt and pepper to taste and saute for 8 to 10 minutes, or until halfway cooked.
Add capsicums and stir in pasta sauce, reduce heat to low and simmer about 10 minutes. Add sherry and simmer for another 10 minutes, then stir in cream and simmer for 10 minutes more. Toss all with hot, cooked pasta and serve.