Definition
A legal process by which the property, money, or credits of a debtor held by a third party are attached or frozen to satisfy a creditor's claim. The mechanism operates against the third-party holder — called the factor, trustee, or garnishee depending on the jurisdiction — rather than directly against the debtor's own hands or property. The creditor initiates proceedings that effectively intercept assets sitting with someone else on the debtor's behalf, compelling that third party to account for what they hold before releasing it to the debtor.
The term is specific to American law and carries historical association with practice in Vermont and Connecticut, where it was known as the "trustee process." Elsewhere across American jurisdictions the functionally equivalent remedy is called garnishment.
Common Confusion
FACTORING PROCESS vs. GARNISHMENT vs. TRUSTEE PROCESS: These three terms describe the same fundamental legal mechanism — attaching a debtor's assets in the hands of a third party — but are not interchangeable across jurisdictions or historical periods. Factoring process is the older New England usage, largely displaced in modern practice. Trustee process remains the term of art in Vermont and Connecticut. Garnishment is the predominant modern American label and is used in virtually all other states. A researcher encountering "factoring process" in a historical source should not assume the procedural rules of modern garnishment apply without checking the jurisdiction-specific statutory framework in place at the time.
Separately, do not confuse the factoring process with commercial factoring — the sale or assignment of accounts receivable to a financing company. That is a transactional finance arrangement with no procedural connection to this attachment remedy.
Why It Matters in Research
The primary research trap is terminological drift. A nineteenth-century New England legal record, pleading, or treatise using "factoring process" is describing what modern researchers would call garnishment, but the procedural rules, the name for the third party (factor vs. garnishee vs. trustee), and the governing statutes will differ. Searching only for "garnishment" in historical Connecticut or Vermont sources will miss materials that use this term.
The term has essentially vanished from modern American legal writing. It does not appear in current statutory codes or procedural rules under this name. Any appearance of "factoring process" in a source postdating the early twentieth century warrants scrutiny — it may indicate an archaic form, a historical quotation, or a typographical or transcription error.
Because the Law Mind corpus spans multiple centuries and jurisdictions, researchers should treat factoring process, trustee process, and garnishment as a family of functionally related terms requiring parallel searches when working across the corpus chronologically or geographically. A case or treatise from Rhode Island in the 1890s, for instance, may use all three terms with slightly different procedural connotations.
The Black's citation to Cross v. Brown (19 R.I. 220) suggests the term was already being glossed and cross-referenced by the late nineteenth century — a sign that even contemporary legal writers recognized it as a term of art requiring explanation rather than one with settled universal meaning.
Historical Dictionary Support
Black's Law Dictionary (2nd Ed., Supplemental) is the sole historical dictionary source for this entry, and its treatment is brief but precise. It correctly identifies the term as peculiarly American, geographically limited to Vermont and Connecticut practice, and functionally equivalent to trustee process and garnishment. The citation to Cross v. Brown grounds the definition in Rhode Island case law, which itself was engaged in clarifying the relationship among these variant terms — suggesting the dictionaries of the period were synthesizing active jurisdictional confusion rather than recording settled doctrine.
What the historical sources do not address: the procedural mechanics distinguishing factoring process from garnishment in detail, the rights and liabilities of the factor/garnishee, or the debtor's remedies. Researchers needing that level of procedural granularity should look to contemporary Vermont and Connecticut statutory compilations and practice treatises rather than general dictionaries.
Jurisdictional Note
The term is historically confined to Vermont and Connecticut. The equivalent remedy in most other American jurisdictions is garnishment, and in those same New England states the modern governing term is trustee process. No jurisdiction currently uses "factoring process" as its operative statutory label.