Start off by checking if the sm420 is over filled with gear oil. I have seen leaks out of the front like that since the rear bearing retainer is open to the collar with no seal on these models If gear oil comes out the fill plug than it has two much oil in it.If that is not the case, then remove the collar and check to see if you have the two little metal washers that sandwich the torque tube seal. If one or both were omitted on reassembly then there is your smoking gun.

Steve
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Last edited by sstock; 09/21/2019 5:01 PM.

1953 Chevrolet 3100
261 cu inch, sm420, 3.55 rear, torque tube still,omaha orange, still 6 volt, RPO green glass, side carrier spare, all done
In the DITY Gallery
Video of the 261 running

1964 GMC 1000
305 Big Block V6, sm420, the next cab off restoration