Here's a description of ‘passed-over two and a half’ from this site:
http://www.bbc.co.uk/ww2peopleswar/stories/22/a4870622.shtml
"The Captain of H.M.S. Londonderry, Lieutenant Commander Scott, R.N., was a ‘passed-over two and a half’, so the crew said. In the peace-time Royal Navy, promotion of an officer is automatic by length of service, up to the rank of Lieutenant Commander. After that there are too few openings for everyone to rise higher. Less than one in four talented, or lucky, or favoured, ones are awarded the three broad stripes of a Commander, with "scrambled egg" on the peak of his cap, and the chance to rise to Rear Admiral, Vice-Admiral, and Admiral. The others, "passed over two and a half s" are eventually retired on half pay, to eat their hearts out ashore."