I am totally flabbergasted by the la's actions. Her reasoning is absolutely inexcusable, and makes no sense. As others have said, she SHOULD have called you before hacking off that much of your quilt.
I would politely but firmly tell her where she went wrong and what she SHOULD have done instead, then I would absolutely take my business elsewhere. How would you feel if she did it again, or something equally as upsetting? You already know she has no common sense and not much integrity as a quilter.