There is no need to use subquery to determine whether
orderlinenumber exists in another table. Just do UPDATE after LEFT JOIN the two tables will be fine, check this:
UPDATE A SET A.oliExists = CASE WHEN B.orderlineid IS NULL THEN 'False' ELSE 'True' END FROM [dbo].[_______Test] AS A LEFT JOIN (SELECT DISTINCT orderlineid FROM [Li]) AS B ON A.orderlinenumber = B.orderlineid
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