Top Hotel \On-sells"Rooms without Authority"""

I booked 6 rooms for the 28th Dec - 30th Dec 2014. 3 of the people were only arriving on the 29th Dec. I sent an email to enquire what the cancellation fee would be and was told it would be 100% cancellation fee. We did not proceed any further and kept the rooms. After an international flight on 28th Dec 4 guests arrived instead of 3 at 11.45pm (we needed 4 of our rooms). At 12am, the front desk called informing me that they didn't have a room for the 4th guest. I asked why and was told \we"had cancelled the 3 rooms and they were already re occupied (sold on). We had not. I was told it was not the hotel's problem and I should find local accommodation myself for the client (at 12am). I told them that it was THEIR problem and that they should find accommodation. They did so. At 12.44am I had to make payment to a 3* hotel nearby. We met with the deputy GM the following day who's attitude was \""it's not our problem"