Could be a ZF tranny. Regardless, your clutch and brake systems share the brake fluid resevoir. As your brakes are spongy, I assume (correct me if I'm wrong folks) that if the fluid level dropped low enough, air may have been introduced into the clutch system as well. I have not experienced this, so I'm just taking a stab at a cheap fix. I would bleed both the brake and clutch systems (brakes should be done if you don't know the history). The clutch slave cylinder and bleed screw is accessed on the drivers side of my ZH bell housing from under the vehicle.
Good luck with it,
Dave