" I am getting engineer involved to approve anything. "

That is really the only advice anyone here can offer. Have the engineer approve the solution, The "sketch" you gave is not enough info. It involves more than just the concrete wall.

Unbelievable! I'd be pissed and want a do-over!

Were not the points for the addition staked by the surveyor, to be precisely where the permit allows?

First I would fire the contractor. What did he/she do before digging a hole? Just eyeball it?

" Is that a possible repair path?"

Yes. It isn't off by that much and shouldn't be that difficult to fix.

Yes, survey marked the corner nearest the lot line. We’re actually now thinking they set that corner based on the survey marker but the house was assumed to be parallel to the lot line but is actually not. They should have still checked square