Social interaction for OSR games

Thanks to Mauro Longo and Cristian Papi for the inspiration.

One of the dilemmas of roleplaying is the relationship between player skill and character skill.

How can you, especially in a freeform system, combine a player's skill, role play, and character's skill?

At the same time, how does the Dungeon Master have an objective yardstick (well, as objective as possible) that gives players the chance to make informed choices about interactions with NPCs and the environment?

Here I offer a small system modeled on Old School D&D, in which much is left to freeform role-playing and to the judgment calls of the DM.