On the transmission remove the fill plug. If oil comes out of the fill lug it is being over filled by the transfer case. As the front seal of transfer case fails the oil from the transfer case is pushed into the transmission. Over filling the transmission may cause oil to spill from transmission to the clutch. Oil on the clutch disc can crystallize and becomes harden and cuts groves into the pressure plate. Also the transfer case oil level drops and may damage the transfer case.
The correct fix it to replace the front seal in the transfer case. Many mudders install a bypass hose for insurance. One never knows when it starts happening. I made up a braided stainless steel hose using banjo fittings for my 74 FJ40. The interior hose is teflon which also resist heat. The braided exterior helps protect the hose from the heat of the exhaust pipe. Other mudders learned of the unique design and asked me to make them one. So rather than dealing with group buys I try to keep both sizes in stock. You have to measure full plug to fill plug. If your thinking I'll just buy the longer one so I don't have to
Measure? Wrong too long won't drain right.
Some Landcruiser shops keep my hose in stock to install on the cruisers that go through their shop. I've sold over 500.
Send me a pm and we can figure out what works best for your situation.
Be sure a PO didn't loose the fill plugs and replace them With a 1/2npt plug. If your threads are tapered it's a pipe thread. Banjo fittings won't seal on a pipe thread. They have to be straight threads. If a PO did do the pipe plug I have a fix for that. Out of 500 three have run into this. So send a pm and see how I can help you.