Let's imagine this goes to court. I'm not a lawyer, and I only have one extracurricular university course of IP law under my belt, but I do have logic. Here's what I think will happen:
First, to summarize the argument:
- The artist believes the contract was worded to license the use of the copy on the website.
- The website owner believes the contract was worded to sell the rights to the copy.
The most direct course to resolution will be to reconstruct the verbal agreement and analyze its wording. If the terms of the verbal agreement are particularly clear, then nothing else matters. However, this is unlikely - even if both parties somehow agree on what the exact wording was, that wording is sure to be far from comprehensive or explicit. So we need to consider other evidence.
I placed copyright signs on the site for the writer as requested.
If you're saying that the website's owner has permitted all of the writer's copy to be marked "copyright [writer's name] 2017" on the own website, then the writer will be able to point to this as evidence that the website's owner has acknowledged and failed to refute the writer's copyright while profiting from that copy.
The website owner will need a reasonable explanation for why they would mark the text as copyrighted to the author while profiting from the copy but then dispute that copyright when their business relationship changed. Since the website is easily accessible, and the owner has absolute power over its content, "ignorance" seems to be their only excuse.
On the other hand, the website's owner might have some ammunition if it can be proven that a single fee was paid for the copy, with no stipulation on how long it could be used. A license ought to have a time or expiration element, e.g. "you can use my copy for $30 per month" or "for $100 you can use my copy for a year". An indefinite license seems unusual, it either gives the copyright holder too much power (being able to terminate the license at will, e.g. after one day) or effectively amounts to sale of the copy (preventing the copyright holder from ever terminating the license), so it's not very good for business.
If the wording of the contract is too ambiguous, then the nature of the transaction is a strong indicator of the nature of the agreement. A single payment followed by a long period without payment is much more like the purchase of content rather than payment of licensing fees. A creative lawyer might be able to run with this.