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2) Move the garage wall sufficiently (several feet) to allow for tree growth for a number of years.
There is no other solution, (e.g., root pruning or trunk carving) that will not inflict serious damage to the tree.
For detailed information on trees and construction, consider obtaining this book which will give you all the information you need (and much more!): "Trees and Development", Matheny and Clark, 1997, available at this site...
http://www2.champaign.isa-arbor.com/publications/publications.html
Torrey