Why did the teacher take it up in the first place? Seems odd.

Anyway, the teacher shouldn't have read it. Once she realized what it was, the only appropriate thing to do was to stop reading it and give it back to the student. The only reason I can see for giving it to the counselor is if she thought it was the student's journal and there was something that the teacher felt needed to be addressed by the counselor. (I can see this happenning if the student was older.) But it sounds like the student was younger and it was clear that this belonged to you and not your son.

If it was clear this was yours, the teacher stepped out of line by taking it to the counselor. I can see if the teacher, again, felt there was something in the journal that concerned her about the student maybe taking it to the counselor, but otherwise no.

School counselors do support students, but also spend time supporting the parents of their students. That's not unusual. Was the counselor really trying to solicit you as a paying client? If so, that would be out of line, but if she was just offering her support, she was within her duties.

Bottom line, neither should have read any further once they realized what they had. I'd talk it over with my therapist first though.