My party was adventuring and we defeated a small foe(a kobold), when looting the body we found a cloak of resistance +2. Because the kobold is small and the cloak is made for small creatures can one of us still wear it (all medium sized)? If not is there some way to re-size it?
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I would say it would really depend on how the cloak is designed (DM's call). If it's not a hooded cloak, you should be able to wear it as a cape, since cloaks typically don't have sleeves. However, cloaks are designed to be able to fully enwrap a person, unlike a cape, which only covers the back and shoulders. As such, since it wouldn't cover a medium creature the way it would a small creature, I'd decrease the saving throw bonus by 1 for each size category the wearer is larger than it is made for (thus a small +2 cloak would provide +1 on saves if the wearer is medium size, and no bonus if the wearer is large, and so on). That's one idea, anyway.
My party was adventuring and we defeated a small foe(a kobold), when looting the body we found a cloak of resistance +2. Because the kobold is small and the cloak is made for small creatures can one of us still wear it (all medium sized)? If not is there some way to re-size it?
visual aesthetics aside, by RAW then yes.
Core Rules page 459, under "Size and Magic Items" implies that magic items other than armor and weapons resize to fit the wearer.