OK. So, I was out walking Louis and here comes this little dog from no where just running across the street

, she stops and starts to growl at Louis and Louis just looks at me and I say nothing to him I just stay calmn, Then I see her owner and she's like "sit" "come" she starts throwing all these void commands to this dog, so I proceed to walk around the dog and she lundges at Louis and I put my leg infront of the two and the lady picks up her dog and continues on her walk!
I praise Louis for not attacking her right back as she scolds her little precious. UGH!!!! Then we see them again and I had planned to let her know she best get her dog a lead just because it could get ran over or bitten by a bigger dog we had just past by. But she saw me and picked her dog up and crossed the street. The dog began to growl at Louis and Louis had had it and lunged at her and growled back. I told him to "knock it off" and he did and I proceeded to walk, I don't blame him though.
I should have said something but I was scared of being rude or confrontational. Im also working on my temper and knowing me I would have made sure she knew I thought she was an idiot. So I just didnt say anything. I forgot to mention this was the second time I saw this dog off leash on a walk. The first time I wasn't with Louis but she growled at me.
I feel bad and angry. Isn't it illegal to have a dog off leash like that?
I promised myself I would tell her something if I were to see her again. But I don't know what or how. Please help