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Don't see how this could happen. You have a seal on the rear of the trans that keeps oil from leaking out. You have a seal on the from of the transfer case to keep oil from leaking out or in. You have a vent on top of the transfer with a hose that runs above the engine. If the hose came loose the transfer will leak oil like it is over flowing.
IN A LAND OF FREEDOM WE ARE HELD HOSTAGE BY THE TYRANNY OF POLITICAL CORRECTNESS!!
Today was the second time I had to pull the fill plug on the transfer case because it was over filled. My son drove it last week and said the trans was slipping so we checked it and it was very low. I have no puddles of trans fluid in the drive way and its not blowing all over the the underside of the jeep as I drive it. I know of this happening on heavy equipment but never thought of it happening on my jeep any one else here had this happen.
Teralo behind a 3 speed auto trans is supposed to have a sleeve in between the 2 that seals both units check that one for a groove cut by one of the seals
I wonder if whomever put the teralow in left the seals out and sealed up the weep hole on the adapter housing. I could swear I saw that on Pirate. Sounds crazy but with all the failures on Teralows there have been some weird fixes to get more oil to them bearings.
Thanks guys, I got the Transfer case out and hauled it down to Brothers to have them go through it .The seal is there but not sure about the seal extension . The new seal and extension will be here some time Thursday all take the old one out then and see what the deal is.
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