Thanks for the input, but i think animating the hat aint' gonna look too good. I tried making a simple hat and putting it on a simple head shape, when you parent the cloth to the head it will move when the spere does, but it doesn't stay on top of the head at all, it just falls off. I need some way of attatching the edges of the cloth to the top of his head so the rest of the hat can be acting as cloth whilst the base of the hat moves wih the head. then the rest of the hat will just follow the heads movements.

Any ideas anyone?
(i made the body a collision object as you said blomkaal)