on 1:JOIN:#avatarrp:{ if ($nick isin %list) { /mode #avatarrp +h $nick } | else { msg $chan Welcome to $chan $nick } }

The ELSE needs a command seperator in front of it this is the same as placing int on another line, thats why u might see constructs like...
if ( ) { ... }
else { ... }

to put it on one line it must be
if ( ) { ... } | else { ... }

essentially i think ELSE is in someway a special IF construct that says IF (last if failed) { }