Comment 2 for bug 990397

I had exactly the same problem.
The only way managed to get the system past kernel update is to manually edit this file:
/etc/kernel/postinst.d/zz-update-grub
And modify the start of the script so it immediately exit with successful state=0:

#! /bin/sh
exit 0
[...] etc...

This will allow the installation of the new kernel to proceed. You will have to edit that file again each time you want to upgrade the kernel.