Fix #7877: Refine instantiation criterion before implicit search

Refine criterion when to instantiate before implicit search. Don'
instantiate typevars that are completely unconstrained. Rely instead
on resolving these typevars by the implicit search.

Author: odersky

compiler/src/dotty/tools/dotc/typer/Inferencing.scala

@@ -112,7 +112,9 @@ object Inferencing {
             force.minimizeAll && (tvar.hasLowerBound || !tvar.hasUpperBound)
             || variance >= 0 && (force.allowBottom || tvar.hasLowerBound)
           if (direction != 0) instantiate(tvar, direction < 0)
-          else if (preferMin) instantiate(tvar, fromBelow = true)
+          else if (preferMin)
+            if force.minimizeAll && !tvar.hasLowerBound then () // do nothing
+            else instantiate(tvar, fromBelow = true)
           else toMaximize = tvar :: toMaximize
           foldOver(x, tvar)
         }

tests/pos/i7877.scala

@@ -0,0 +1,21 @@
+object Example extends App {
+
+  trait ZSink[-R, +E, +A0, -A, +B] {
+    def orElse[R1 <: R, E1, A00 >: A0, A1 <: A, C](
+      that: ZSink[R1, E1, A00, A1, C]
+    )(implicit ev: A1 =:= A00): ZSink[R1, E1, A00, A1, Either[B, C]] =
+      ???
+  }
+
+  object ZSink {
+    def identity[A]: ZSink[Any, Unit, Nothing, A, A] = ???
+    def fail[E](e: E): ZSink[Any, E, Nothing, Any, Nothing] = ???
+  }
+
+  // compiles
+  val a: ZSink[Any, String, Int, Int, Either[Int, Nothing]] =
+    ZSink.identity[Int].orElse(ZSink.fail("Ouch"))
+
+  // cannot prove that Int =:= Nothing
+  ZSink.identity[Int].orElse(ZSink.fail("Ouch"))
+}