In 1812, Richard G. Waterhouse and Judge David Campbell provided 19,000 acres for the government seat of Rhea County. The land was surveyed and lots were sold that spring. It may have been named Washington for an early settler. Richard Waterhouse laid out additional lots for the suburb he called Southern Liberties. The town thrived for several years, but the division of the county in 1836, the Civil War, and a railroad built four miles away in the 1880s all contributed to its decline.

Richard Green Waterhouse was born on April 11, 1775 in Hunterdon County, New Jersey to Henry and Elizabeth (Green) Waterhouse. He was one of six children, including Charles (April 5, 1767), John (March 8, 1772), Richard, Margaret (May 1, 1779) and Elizabeth (February 16, 1782). When he was twenty years old, Waterhouse set out on foot to Tennessee, supporting himself with teaching positions along the way. Once in Tennessee, he lived primarily in Knox and Rhea counties and worked as a ferry owner, land speculator, liquor retailer, farmer, and attorney. Waterhouse served with the East Tennessee Volunteers under Colonel John Williams from November 1812 to March 1813, fighting mostly in Florida. He died on March 6, 1827, in Rhea County, Tennessee.

Richard Waterhouse was married twice: first to Polley Tipton on September 8, 1805 and second to Elizabeth (Betsey) Hackett on January 1, 1816. He had six children with each of his wives: Richard (August 11, 1805), Ammon (August 23, 1806), Blackstone (August 21, 1808), Myra (February 6, 1810), Cyrus (September 30, 1812), Darius (January 14, 1815), Euclid (October 3, 1816), Elizabeth (October 28, 1818), Ann (February 9, 1821), Vesta (March 3, 1822), Franklin (July 20, 1823), and Porcia (December 11, 1826).

Born in Virginia in 1750, David Campbell joined the Continental Army in 1776 and rose to the rank of major. Prior to 1783, he moved to Greene County, Tennessee, where he became involved in the State of Franklin movement. He was named chief judge of the State of Franklin and served as a member of the Council of State. In 1792, Campbell served on a national government-sponsored commission to run and mark the line between white settlers and the Cherokee. In the first legislature of Tennessee, Campbell was defeated by William Cocke for a senate seat. He was then elected to the Superior Court, a position he held until 1809 when he was defeated by James Trimble. His time with the Superior Court was marked by an unsuccessful 1803 attempt to impeach him for misconduct in office. Nominated to a federal judgeship in the Mississippi Territory in March 1811, bad health prevented him from serving in this position. Campbell died in 1812 at his home near Lenoir City, Tennessee.