I recently bought an old C40B-538-893 107 forklift with problems. After getting the engine to run I found it would not move in forward or reverse. It has an automatic transmission. I did get it to move only to find it had NO brakes. I found the master cylinder full of water so I've ordered a new one. While removing it I discovered something that has me puzzled (I've never worked on a forklift before). The line from the master goes to a cylinder built into a valve body on top of the transmission. Next to this another brake line leaves another port which tees off to each side of the drive unit. The small cylinder is frozen. I plan to drive the piston out the back, clean the rust and replace seals. I would like to know how this setup works, I have a theory but I'd rather have someone explain it to me. Moving the arm attached to the rod of the cylinder is how I got the thing to move. Another question is what fluid actually works the brake, transmission fluid or brake fluid?

Any help or information will be appreciated very much.