Here's a brief summary of how the practice of calling priests "Father" began and spread: 
http://bustedhalo.com/questionbox/when-did-the-use-of-father-become-a-practice-in-the-catholic-church-for-ordained-priests

Secular (diocesan) priests in the United States wore the secular clothing of the day (when not engaged in sacramental ministry) and were commonly addressed as "Mister" in the secular communities in which they lived.  The clerical suit and collar for use in public in the United States, away from the church or chapel, was not required  until the Third Plenary Council of Baltimore (1884).