[Bug] Chat completions rejects custom tools with key 'function' not found

[natke]

Describe the issue

The OpenAI-compatible /v1/chat/completions endpoint rejects a request containing a custom/freeform tool definition. The server assumes every tool contains a function property and returns HTTP 400 for a tool whose type is custom.

Observed response:

Invalid request: [json.exception.out_of_range.403] key 'function' not found

A control request containing only a standard function tool passes tool parsing. The expected behavior is either to accept the custom tool schema or return a clear unsupported-tool-type error rather than attempting to read a missing function property.

To reproduce

1. Use Microsoft.AI.Foundry.Local version 2.0.1.
2. Load qwen3.5-2b-text-cuda-gpu:1 and start the local web service.
3. POST to /v1/chat/completions with one standard function tool and this additional tool:

{
  "type": "custom",
  "custom": {
    "name": "freeform_tool",
    "description": "Accepts freeform input.",
    "format": {
      "type": "grammar",
      "grammar": {
        "syntax": "lark",
        "definition": "start: /(?s).+/"
      }
    }
  }
}

The response is HTTP 400 with key 'function' not found. Sending the same request without the custom tool progresses past request parsing.

Urgency

This prevents clients using OpenAI-compatible custom/freeform tool schemas from sending those requests to Foundry Local.

System information

• Platform and architecture: Windows X64
• OS version: Windows 11
• Installation type: Released package/binary
• Foundry Local version: Microsoft.AI.Foundry.Local 2.0.1
• API or surface area: REST API
• Hardware acceleration/backend: WebGPU/CUDA
• Backend/runtime version: ONNX Runtime 1.28.0; ONNX Runtime GenAI 0.15.2