Adventure stories don't have random encounters. What? Yes, you heard right. Anything anyone sees in a novel is specifically shaped to give some impression, to build story, or to reveal elements of character. Nothing can be random, because everything is planned by the author. The same goes for 7th Sea—there is no system in place for random encounters. When the GM feels like there should be an encounter, there is one. When the GM needs an encounter to happen, it does. This is a fantastic opportunity to slip into the dreaded illusionism that has been so well illuminated by the OSR for indeed, the method of fiat encounter and "story development" runs the risks of utterly destroying the all-important freedom of choice of the player. What, then, is a good GM to do?
The easiest way is to just force random encounters into the 7th Sea system. For many reasons, this is a sub-optimal solution. Firstly, 7th Sea does not operate with the assumption that there will be random encounters and has no reward for fighting (other than survival). Additionally, encounters are unlikely to drain resources the way they do in D&D because of the nature of swashbuckling. The best use for random encounter tables would be for "flavor" encounters of the kinds that display illuminating scenes. I admit that I have used flavor encounter tables (for things like occupied Castille; do the players stumble across, say, a work-gang of Montaigne deserters being forced to build revetments?) and even this seems slightly at odds with the intentions of the game.
There are things to look out for when deciding, fiat-like, on what things players should encounter:
Nonresponsiveness. Once you know the encounter is going to happen, make sure you give the players the opportunity to ride around it, choose a different route, etc. Do not, for example, force the players to encounter Jean-Luc le Fevre on the road to El Morro if they were going to encounter him in San Cristobal but they avoided the inn where he was staying. This helps preserve the meaning behind player choices. Nonresposiveness also includes not altering the set-up of an encounter to anticipate player disposition or action—but if you have a Villain there, feel free to spend two drama dice of your own to allow them to anticipate players...
Thematic encounters. Encounters should not only be obstacles (the group of Montaigne soldiers on the road that ask for your papers) but also thematic (the Castillian priest being executed for speaking against sorcery) so they help flesh out the world. Whether the PCs involve themselves or not in these encounters, they will help build the "feel" of Théah.
Appropriate encounters. Even if you are going to wing an encounter (and why not, in the absence of formal encounter charts?) they need to be appropriate. If the Heroes are lying low in a cellar in the Vodacce countryside, it's not very nice (and it destroys the fact that they made this choice) to simply have searchers stumble upon them. At the very least there should be some roles that make it more or less likely they do (maybe a wits check with a TN) or the required expenditure of a drama die on the GMs part to let the Villain or Henchman leading them decide to go down there.
Choices, choices. The most important part, of course, is that the players are left some options when an encounter occurs—they should be able to see the encounter coming in many cases, making decisions on how they want to approach handling it, that sort of thing.
When you aren't letting the dice soak up some of the arbitrary nature of GMing as one does when using encounter tables, one needs to be extra careful not to tread on player's autonomy.