Sounds like a leaking rear main seal.
Don't believe you will find a seal in it. It has a slinger that keeps the oil in the engine. Can leak when shut off if left on a slope with the front up.
Norm, definitely check the breather situation because that's the easiest fix. Clean it out (or even take it off and replace with a temporary open pipe and give it another run.
The clutch won't snap over and sometimes it won't let the transmission in or out of gear. I think that is a matter of adjustment or the friction material has swollen. I can't figure why the oil level in the clutch would get so high without draining back into the engine. Is there a pump for the clutch or is it a "Splash" system? I don't have the D4, it is for sale and this is the debate I'm having with myself as to should I buy it.
The oil clutch has its own circulating pump. If it won't snap over center it is either out of adjustment or the clutch plates are stuck. If it's gaining oil it's either due to high pressure in the main engine sump due to blow by, clogged vent or worn main bearings. There is no rear seal, just a reverse corkscrew thread on the crankshaft to pull oil back into the sump.
Thanks to O M and O I H for setting me straight about the seal. My D7E was gaining oil in the clutch and is designed with the same reverse-rotation auger machined into the rear main journal; the problem with mine was due to its seal. But where there is no seal, the guys are correct: wear in the rear main and excessive crankcase pressures are the most likely causes for oil to migrate from the engine to the oil clutch housing.
As to the question of purchasing the machine, I'd still get it if the UC was decent enough and wouldn't let the oil issue hinder the purchase.
Cheers
My First Cat was a very late 7U 43600 odd serial No and it developed this Problem, Sometimes I carried a Small pump to transfer Oil back . I found out that there was Lip seal that Could be Fitted as these were fitted to Grader Motors apparently , That was 35 years ago , was a fair amount of Work to fit it in , Recall having to drill a drain Hole in Front of seal . The dealer got that Seal from Singapore Depot I well remember . It did not stop it Leaking Completely ,but made it Quite manageable .I can't recall about Breather though ,I was only a learner Bush Mechanic in Those days [Still am !!] That tractor had the 2 Speed Reverse Option in it . bearings may have had some wear to allow this too happen also . LJ
It would seem that the opinion is to get this tractor even with the problems it has. It is a package deal. The D4 with the problems also has a Hyster winch so that is a plus. The second part is there is a well worn loader (933) with worn tracks and a bad main (connecting rod?) but a good pony, a dry clutch and the loader part shot included for $3K. The two machine's serial numbers are about nine digits apart. I am running out of places to put machines so if I go for the deal the parts machine will have to go.