The resolution is to enable XVHDL for synthesis. XVHDL is the VHDL compiler which should be used with Foundation. You can reset Foundation to use XVHDL by selecting Synthesis->Configuration from the HDL Editor. This will open a Configuration Dialog Box. Click on the Tools pulldown menu and select XVHDL.
If the user has created an Active-VHDL project and used the synthesizer in that tool (mmvhdl) and then attempts to synthesize within the HDL Editor of Foundation, the error may be encountered.
The workaround is to create a new Foundation project and adding the relevant VHDL file to that project. Then, proceed with Synthesis -> Configuration and select XVHDL. Do a check syntax and synthesize as usual.