I'll check on the pump. I have taken the filter housing off and re sealed with rtv several times but will check again. Its hard to find information on it because it seems like manuals are non existent. I'm hoping this problem also solves the lack of power in the monotrol system because even the smallest hill will stop it.

Does the hydraulic pump have a large 3/4" whitworth (now I'm showing my age!) what looks like a blank plug looking from beneath, if it has, remove and the flow divider/priority valve is there over the years experience all it will need a check of the o rings and a clean up put everything back as you found it, number of turns on the threads etc, reassemble and test.
With oil overflowing check the scoop mounted on top of the bell housing above the torque converter loosen the two bolts beneath the cover plate push across till it stops then back a touch, I have had a few of these pick up scoops break off but invariably transmission oil is every where. Hope this helps good luck

the hyd filter set-up is critical on these old girls the filter can draw air internally.strip out the filter and check the tin part is sealed to the top plate of the filter housing

I know it has been years since the last reply, but I am having the same problem with the same forklift. It has no power in drive or reverse, monotrol setup, and if it is revved at all during the first ten minutes of warm up the hydraulic pump losses prime. Will be replaceing suction hose soon, looked at hydraulic filter and it certanly easnt covered with gunk. Not sure where to head from here, I dont have a manual yet. Other than not having any power, once limped to full operating tempersture the hydraulics work great. Thanks.

Nope ,sound like a problem with the pump, is has a priority valve in it.steering gets the oil first no hydraulicsi would say pump.

Would the wet bellhousing scavenging system cause a loss of hydraulics in both the hoist/tilt & P/S systems?

you can get at the scavange tube from under the plate on top of the bellhousing ,you can adjust it by moving it side to side.

Digging into memory.............Bellhousing is wet but there is a scavenge system. Check the oil scavenging in the bell housing.
There is a cast aluminium scavenge scoop in the bell housing. If it has become loose, broken or worn away by the scavenge ring (like a round cake tin) after it came loose, the bell housing will fill up.

Tim B
Hampshire , England.
PS if you ever need to separate the engine from the transmission you will need to loosen the scoop fastening capscrews so that it can be "extracted" from the scavenge ring.

Tx for the input- I did think of that but the oil is not foamy & I had it running for about 1/2 hour & it never overflowed for me.

I'm thinking that either the flow divider or the pressure regulator to the P/S & trans circuit failed, I just don't have a parts or service manual to confirm what I find if I disassemble those 2 units.

Sounds like it is *** air. Is the hydraulic oil foamy?
The first and cheapest thing to try is replacing the suction house. I've seen where they get porous enough to *** in air but not enough to leak.