Line of code is marked with an error when "on" alias for a table is used in a SELECT statement. It is just that TOAD marks this line of code with an error (not a warning) but it is actually not an error.

Product Defect ID - QP-4392
WORKAROUND
- None (Ignore the error as Toad compiles the query even with the error)
STATUS
Waiting for fix in a future release of Toad for Oracle.