Despite accompanying cracking in the drywall at this corner, I am told by the Home Builder's engineer, that this is not evidence of settling, and that it was probably built that way. They are recommending a "cosmetic" repair. Also I would note, that the grading of the soil at this part of the house is sloped upwards away from the house, such that water does not drain away. I am told this does not affect soil strength.
Some quick thoughts on this:
1) Drywall cracks are common for small amounts of movement. Drywall is very brittle and this is often the only "damage" that will occur. So, this alone is not cause for concern.
2) Now, nearly 1.5" of differential movement over 12.5 ft. That's a different story.... That's quite a lot.
3) Something similar occurred with my house.
a) Original construction of my house was 1972. Some minor sloping in the neighborhood suggests some of my house was on engineered fill.
b) There was an addition added in 1982-ish. There is addition extended the house out maybe 8 feet in one direction. Well, the soil under the addition was on fill, but it was NOT the engineered fill that other parts of the house were built on.
c) As such, there was significant settlement of the slab. More than an inch over the, 8 feet or so of the addition.
d) Most of the settlement happened in the first few months during construction. BEFORE the drywall was placed.
e) Over the next few years (I bought the house in 2001) some more settlement occurred and the drywall cracked. Only a little bit. But, it really drew the attention of people who were interested in buying the house. So, it affected the price of the house.
f) After 3 to 5 years, any settlement of the house due to the weight of it on the soil is usually very minimal. So, I felt comfortable buying the house.
g) When we re-did the kitchen (10 years ago), we ripped out the drywall and replaced it.... drywall cracks haven't returned.
h) I also used some topping material over the slab to "level it out". I couldn't level the whole amount out, but it's much, much less noticeable.
i) I also replace the tile flooring with hard wood flooring (which is much less sensitive to movement).
I mention my experience because even when something APPEARS to be a huge problem, a simple / cosmetic fix can be a valid solution. In your case, I don't know for sure. I'd want to understand the root cause of the movement. Is it settlement that occurred mostly during construction (and before the drywall was placed) like it was for my house? That merely cracked drywall slightly as the last little bits of settlement were squeezed out of the soil? Or, was there a different event that caused this? Moisture infiltration, broken pipe, et cetera.