What does the term 'garnishment' refer to in a legal context?

Garnishment in a legal context specifically refers to a legal method of debt recovery that allows a creditor to collect a debt by seizing assets from a debtor's wages or bank accounts. When a court issues a garnishment order, it directs third parties, such as employers or banks, to withhold a portion of the debtor's earnings or funds and remit them to the creditor to satisfy the outstanding debt.

This process is typically initiated when a creditor has obtained a judgment against a debtor and is seeking a practical means to enforce that judgment. Garnishments can be an efficient way for creditors to recover owed amounts without direct confrontation with the debtor, as the collection occurs through the debtor's employer or financial institutions, which have a legal obligation to comply with the order.

The other options do not adequately describe the nature of garnishment. Liquidating assets pertains to converting assets into cash, which is unrelated to the specific legal mechanism of garnishment. Contract enforcement generally involves ensuring that the terms of a contract are honored, which is a broader concept that encompasses various legal actions, but does not specifically define garnishment. Finally, arbitration is a dispute resolution process outside of the court system and does not relate to the collection of debts. Thus, the characterization of garnishment as