Recently, my family hiked in to a back country camp in a national park. We had an assigned space within the campground but when we arrived our space had been occupied by a camper registered in another site. They had set up their camp and were out hiking so we could not discuss the issue. Not wanting to hang out and wait with full packs, (they finally returned several hours later) we looked at other unoccupied sites and decided to take one of those. The site we chose had apparently not had anyone reserve it as no one approached us with their permit but there was another party who also had the same issue and ended up taking another empty site. I am wondering what the proper etiquette for this situation might be. I hate to push someone out of a site if another will work as well. We ended up with a far better site that we had reserved but had we reserved the better site I would be upset.
What you did was probably the most peaceful course of action, but ultimately, the best people to direct this question to would be the people who issue the permits, the proper etiquette will likely differ from place to place.
Unfortunately, there really isn't a pleasant global solution to this. By all rights you could have moved their stuff to the side and set up your camp in the spot, but people get touchy when you mess with their things, and you could be setting yourself up for a confrontation by doing so. What you chose to do was probably wisest in order to avoid an awkward or heated encounter. Even waiting around until they showed up and explaining to them, "Hey, we reserved this spot, here's our permit saying so." could have created an unpleasant atmosphere, despite how pleasant both parties may have reacted, I imagine their first response would have been along the lines, "Is it really that big of a deal? Can't you just pick another spot? There are plenty around..." The best thing to do, would have been to notify the campground custodian, if there was one available, which is not very often at backcountry campgrounds. Otherwise, use your own discretion, perhaps they are simply unaware that the sites are assigned, I think every backcountry campground I've ever been to have all been first come first served, even with a permit, most of the time the permits are just so they can keep a count of how many sites are being used, so they don't over crowd the area, they're also used in the event of an emergency (forest fire), so they can know how many people they may potentially need to evacuate, or search for.