As others have said, if you want to go the legal route, it's probably going to come down to whether the fence is still adequate. Unless the fence is starting to deteriorate and become a hazard, then it seems like it probably is adequate. From what you've said however, it may just take another year or so of waiting before you're at that point.
Where does that leave you for now? Unfortunately, you're probably going to need your neighbour's agreement to have the fence replaced, and that's probably going to require you covering most or all of the cost by the sound of it. If having the asbestos on your property is causing you stress, then that might be worth it for you. We had asbestos on our garage removed professionally, but only because it was beginning to crack and break in places. Keep in mind that a replacement fence is likely to be treated timber, which poses its own health risk from dust when it is cut.
bazzer: I have reservations about having a similar conversation with my neighbour. Our boundary is quite long with them so I suspect the fence (new in our case, not a replacement of an existing fence) will be more expensive than yours. I wouldn't know what to do to encourage them to go halves if they were not so inclined.
You'd be covered under the fencing act thingy mentioned previously. They are required to go halves on an adequate fence. So if you want something extravagant then they only need to pay for half of a basic fence and you cover the rest. I went through this a few years back when I finally got round to replacing the falling down iron fence. Found out who the landlord next door was and made contact. They were happy to come to the party, especially since I did the work myself. Only cost them about $450 for the shared boundary.
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