Adding a color background and border radius to a Layout

You don't need the separate fill item. In fact, it's invalid. You just have to add a solid block to the shape. The subsequent stroke draws on top of the solid:

<shape 
    xmlns:android="http://schemas.android.com/apk/res/android" 
    android:shape="rectangle">

    <corners android:radius="5dp" />
    <solid android:color="@android:color/white" />
    <stroke
        android:width="1dip"
        android:color="@color/bggrey" />
</shape>

You also don't need the layer-list if you only have one shape.

background.xml in drawable folder.

<?xml version="1.0" encoding="UTF-8"?> 
<shape xmlns:android="http://schemas.android.com/apk/res/android"> 
    <solid android:color="#FFFFFF"/>    
    <stroke
        android:width="3dp"
        android:color="#0FECFF" />

    //specify gradient
    <gradient
        android:startColor="#ffffffff" 
        android:endColor="#110000FF" 
        android:angle="90"/> 

    <padding
        android:left="5dp"
        android:top="5dp"
        android:right="5dp"
        android:bottom="5dp"/> 
    <corners
        android:bottomRightRadius="7dp"
        android:bottomLeftRadius="7dp" 
        android:topLeftRadius="7dp"
        android:topRightRadius="7dp"/> 
</shape>

<LinearLayout
    android:layout_width="match_parent"
    android:layout_height="210dp"
    android:orientation="vertical"
    android:layout_marginBottom="10dp"        
    android:background="@drawable/background">