I live in western WV. and around here, on hillsides and heads of hollows we have layers of blue clay that occur in what pond builders around here call " slip seams ". These seams are places where the land has slid or slipped over a deeper layer, possibly thousands of years ago usually because of an up hill spring or seep. The water flow either deposits the layer of blue clay or colors it blue. These layers are wet and slippery and always slope downhill.

This layer is a very poor foundation for possibly hundreds of tons of dam.
Always dig down below this layer until you find rock or brown or multi colored clay.

Another thing that needs to be remembered is that a hillside hollow pond needs more than just a dam crossing the slope. It also needs to be dug back into the hill and to the sides because if this clay is not dug up and repacked, just like you did the dam material, the water that fills your pond will go to the side and seep through the hill around your dam and cause your pond to leak or even cause a major slip of the slip seam your pond is built on on either side of your dam. EVERYTHING that is going to be under water MUST be dug out to an appropriate depth and repacked. The appropriate depth is below all slip seams and when replaced and packed, the clay is thick enough for the depth of water it must retain.

If when you dig into the uphill side you find a spring that is below water level I think you should pipe it through the clay to the water in your pond or just jeave it uncovered with clay because if you block it it will back up into the hill and find a way around your pond and lead to a slip.
Piping it into the pond will only help a little as the back pressure from the water column above the spring will tend to force the water to seek an other path to relieve the new back pressure. You could pipe it under the pond and through the dam,or to the surface to the side of the dam bypassing the whole situation.

Another problem with this below water level spring is that most springs during a dry time disappear and the spring them becomes basically a hole in the bottom or side of your pond. This will make your pond drop just when you want water most.
Ideally you want your water level below any springs, and the spring flows down into the pond.

Also if this slip seam does not disappear or run up to the surface uphill from your dam before it reaches the future water level then when you cut out the bottom of this seam in building the pond the remaining top portion of the old slip has nothing to hold it up anymore and may slide down into your pond

In some ways water can be a ponds worst enemy.

Most of my ponds are on the top of the hill with nothing above them but sky and no source of water except the rain that falls into them. They stay full and overflowing with clear water all year long except during sevier drought years in summer.

How do I post pics ? I'll show you.