The problem is that the water level is to high,the handles are not a water tight fitting.You'r float hight needs adjusting,the valve may need replacing.If it is an old type with a long rod with a ball on the end hold the rod at both ends and bend it downwards at the ball end so it touches the water level sooner puting more pressure on the valve so closing it off better.The water should have been draining out of the overflow pipe even before it reached the handle level.
Rich
November 2007