During a battle, I had a substitute up with Kyurem. (Pokemon probably doesn't matter but I am giving information)
The opponents Rotom used volt switch, and then switched out to another pokemon, breaking my substitute as it did.
I was slower than the rotom, so I used substitute to recreate my sub once it broke.
It told me that the move failed, and did not create a substitute.
The next turn, I was able to create one without issues.
This also happened once more with the move Knock Off from my opponents Landorus-T.

From my understanding, it seems that the substitute move checks if you already have a substitute at the beginning of the turn, rather than if you have one when your pokemon uses the move. Hopefully this is a simple fix, just moving an if statement. If not, please feel free to ask for any other information.

HI, tested in 1.12.2-8.4.2 using an NPC trainer I was able to re-create the issue.

I had the npc trainer throw out a pokemon with only splash while my rhydon setup substitue. I then knocked the lvl 1 pokemon then the trainer threw out the lapras I gave them with only water gun.
I selected substitute knowing I was slower and after the lapras' water gun broke the substitute, my move to use it again failed. Then next turn after tanking a water gun rhydon was able to put his substitute up again. But then the issue happened again the next turn where the substitute move failed when I used it on the same turn it was knocked out.

Forwarded to Internal, thank you!

Fixed in 9.0.8. If this continues to be an issue, please make a new ticket. Closing.